Online Safety Act 2023: What UK Businesses Need to Know About Compliance and Risk Management

The digital world has changed how we do business in Britain-creating new opportunities, but also new risks. With online scams, harmful content, and privacy breaches grabbing headlines, it’s no wonder that the UK government has introduced strict new rules to help keep the internet a safer place.

The Online Safety Act 2023 is one of the most significant pieces of tech regulation we’ve seen in years. If you run any kind of business with an online presence-from e-commerce stores to marketplaces, SaaS, online services, or even content creation-this law will almost certainly affect you.

But don’t stress-while it might all sound daunting, with the right planning and legal guidance, your business can stay compliant, protect your brand, and build customer trust. In this guide, we’ll break down exactly what the Online Safety Act 2023 means for UK businesses, what your compliance obligations are, and practical steps you can take to manage the risks. Let’s jump in.

What Is the Online Safety Act 2023 and Who Does It Apply To?

The Online Safety Act 2023 aims to make the UK’s online space safer for everyone-especially children and vulnerable people-by placing significant new obligations on businesses operating digital platforms, websites, and online services.

Key facts about the Act:

• Applies to: Businesses that host user-generated content (like comments, reviews, forums, social media posts), enable user interaction (messaging, chat), or provide search engines and many online service platforms.
• Main goal: To prevent illegal and harmful content online-including things like fraud, hate speech, cyberbullying, child exploitation, terrorism, and more.
• Enforcement: Ofcom (the UK’s communications regulator) is in charge of monitoring, investigating, and enforcing the Online Safety Act 2023. It has hefty new powers to fine and even criminally prosecute companies or senior managers who ignore the rules.

This law is aimed at both UK and overseas-based businesses whose online services are accessible to UK users. That means even if you’re a small startup or running an online shop, if people in the UK can use your platform or service, you must pay attention.

It’s a big shift for digital compliance, so whether you’re launching a new e-commerce website, running a SaaS platform, or hosting forums or content, you need to understand what’s expected.

Why Has the Online Safety Act Been Introduced?

It’s no secret that harmful content, scams, and illegal behaviour have become a huge issue online. The government and the public have demanded more action from tech giants and smaller providers alike. The main reasons for the Act include:

• Increase in harmful online content: From grooming and cyberbullying to fraud, misinformation, and extremist material, the risks are wide-ranging and often hard to monitor.
• Protecting children: Millions of young people use digital services daily, and the Act sets strong rules around age-appropriate design, controls, and content moderation.
• Clear accountability: Until now, many online platforms lacked clear legal responsibility for the content users posted. This Act makes businesses directly accountable for policing their own platforms.
• Public trust and business reputation: By following the Online Safety Act 2023, businesses can show users they take safety seriously-a major competitive advantage in today’s privacy-conscious market.

While this may sound like another bureaucratic hurdle, it’s actually a chance to review your current risk controls, boost trust, and set up strong legal protections for your business from day one.

What Types of Businesses Are Caught by the Online Safety Act 2023?

It’s not just tech giants that are in the crosshairs-many everyday UK businesses fall under the Online Safety Act. You’re likely caught by these rules if you operate any of the following:

• E-commerce shops with reviews, comments, or any public posting features
• Marketplaces, classified ad sites, directories, and buy/sell platforms
• SaaS and online service businesses enabling file sharing, chat, or collaboration tools
• Online communities, forums, social networks, or apps with user profiles and posts
• Any business website where users can upload, share, or interact with content (even as simple as a blog comments section)

The law is intentionally broad-if your site allows users to interact, post, or message, you’ll need to take action. If you’re unsure, speak to a legal expert to confirm if you’re in scope.

What Are the Main Compliance Duties Under the Online Safety Act 2023?

So, what exactly does the Online Safety Act 2023 require your business to do? The obligations vary with business size and risk, but the core duties typically include:

• Minimising illegal content and risk: You must have appropriate systems and controls to swiftly detect and remove illegal content (including terrorism, child sexual exploitation, hate speech, etc.).
• Protecting children and vulnerable groups: Platforms likely to be used by minors must take extra steps to prevent exposure to age-inappropriate material and use child-safe design.
• Effective reporting and removal processes: Users must be able to report harmful or illegal content easily, and you must have procedures to investigate and act quickly.
• Transparency: You are required to issue clear public statements (transparency reports) about your risk management, safety processes, and incidents on your platform.
• Record keeping: You must keep detailed records of complaints, reports, and how you responded-this is crucial if you’re ever investigated.
• Risk assessments: Businesses must regularly identify and document the risks of harm on their platforms, and show what steps they’re taking to reduce those risks. Larger or higher-risk platforms have even stricter assessment controls.

If you use algorithms, AI-driven curation, or have automatic moderation, you’ll also need to consider how these comply with the Act.

Want more detail about online business compliance? Check out our guides on e-commerce law or consumer contracts.

What Are the Risks of Non-Compliance?

It’s tempting to see compliance as just another box to tick. But failing to meet the Online Safety Act 2023’s duties can have severe consequences:

• Heavy fines: Ofcom can levy fines of up to £18 million or 10% of global annual turnover (whichever is higher!).
• Criminal liability: Senior managers can be prosecuted if their business wilfully ignores key safety duties.
• Brand and trust damage: News of unsafe practices or failures to protect users can rapidly erode your customer base and tank your reputation.
• Service disruption: Ofcom can even block access to non-compliant online services in the UK-potentially putting you out of business.

It’s far cheaper and easier to set up robust compliance tools now than to deal with investigations or fines later. Plus, having the right documentation in place (like Privacy Policies and clear user terms) can help prove you met your obligations if anything ever goes wrong.

Practical Steps for Online Safety Act 2023 Compliance

Fortunately, you don’t need to be a tech giant to put sound safety and risk controls in place. Here’s a step-by-step roadmap to help your business stay compliant and manage risk under the Online Safety Act 2023.

1. Scope Out Your Platform’s Risks

• Review all your interactive online features-comments, discussion boards, uploads, private messaging, etc.
• Think about the groups who use your site and any unique risks (eg. targeted scams, minors, hate speech, etc.)
• Complete a written risk assessment and update it regularly. This is a requirement under the Act for most in-scope businesses.

2. Draft and Update Your Online Policies and Terms

• Have clear, robust user Terms of Use that prohibit illegal and harmful activity, explain reporting mechanisms, and set behaviour standards.
• Review and update your online terms and conditions across all your platforms and make sure they’re up to date with Online Safety Act rules.
• Make sure your platform’s Privacy Policy is transparent about your safety practices and how you handle and report illegal content.

3. Set Up Effective Content Moderation Systems

• Use a mix of technology (AI, filters) and human moderation to keep illegal or risky content off your platform.
• Set a clear process for users to report content and complaints, including timescales for investigation and removal.
• Train staff on how to spot illegal content and act quickly if issues arise.

4. Prioritise Child Safety and Age Verification

• If your service is accessible to children, implement strong age-checking controls and avoid features likely to pose risks (e.g. open messaging, anonymous profiles).
• Use child-appropriate design and comply with the government’s Age Appropriate Design Code wherever relevant.
• Document all steps taken in your risk assessment-this can help protect you in case of future scrutiny.

5. Maintain Transparent Reporting and Record-Keeping

• Keep logs of complaints, user reports, and your moderation responses.
• Be ready to provide Ofcom with reports on your risk controls, issues encountered, and steps taken to protect users.
• Update the public (via your website or annual transparency report) about your progress and challenges in online safety.

6. Regularly Review and Test Your Controls

• Compliance is not a “set and forget” task. Schedule regular reviews of your systems, policies, and risk assessments.
• Test your reporting and moderation processes from a user’s perspective (are they easy, quick, and effective?).
• Get external legal or compliance advice to make sure you haven’t missed any new rules or best practices.

Want to learn more about managing data and privacy compliance? Take a look at our GDPR and data protection compliance guides.

How Does This Link With Other Laws Like GDPR and Consumer Law?

If you’re thinking, “I already have to follow GDPR and consumer law-how is this different?” you’re not alone. The Online Safety Act 2023 works alongside these other key regulations, rather than replacing them.

• GDPR and Data Protection Act 2018: If you process user personal data (especially when using algorithms for online moderation or age checks), you must comply with GDPR rules on privacy, consent, and data minimisation.
• Consumer rights: All online businesses must comply with consumer law rules around fair terms, misleading advertising, and complaint handling-with extra care needed where user-generated content is involved.
• Employment and contractor law: If your team or contractors are involved in moderating content, set out clear duties and confidentiality clauses in their contracts.

You can’t just draft a one-size-fits-all set of policies. Your business needs a tailored approach-done by legal experts who understand how these various new (and established) laws fit together.

For tailored advice, find a small business lawyer with experience in UK digital law.

What Legal Documents and Contracts Should My Business Have?

With tighter scrutiny under the Online Safety Act 2023, your contracts and policy documents matter more than ever. At a minimum, consider:

• Website Terms of Use-outlining what’s allowed on your site, content standards, and your right to remove harmful material.
• Privacy Policy-fully transparent about content moderation, reporting, complaint handling, and cooperation with authorities.
• Moderation procedure manual-for your team so they understand their responsibilities and processes for removing content.
• Contractor and Employee Contracts-with specific online safety, confidentiality, and reporting duties.

Avoid using generic templates or DIYing these crucial documents. Legals drafted to your specific risks will stand up better if you ever face a dispute or need to show Ofcom that you took “appropriate” action.

For a specialist review or drafting service, explore our contract drafting or privacy solutions.

What Support Is Available for Small Businesses?

We know most small business owners aren’t compliance experts. The good news? There are resources and expert advisors ready to help:

• Ofcom’s guidance and codes of practice: Ofcom will publish sector-specific codes and step-by-step guidance to make compliance more straightforward.
• Legal support: An experienced business and IT lawyer can review your policies, train your staff, and help you build a practical risk management plan.
• Industry bodies: Membership in a relevant trade group or association can give you early access to templates, updates, and networking opportunities.

And if you’re just not sure where to start, don’t hesitate to get in touch with us. We’re here to help UK businesses navigate new laws with less stress and more confidence.

Key Takeaways: Getting Your Online Safety House In Order

• The Online Safety Act 2023 creates new legal duties for many UK businesses whose websites or platforms host user-generated content or interactions.
• Key compliance steps include robust risk assessment, fast removal of illegal content, clear user reporting tools, transparent safety documentation, and special protections for child users.
• Non-compliance carries serious reputational, financial, and even criminal risks-prevention is much easier and cheaper than cure.
• Your risk controls and policies must be tailored to your business model; professionally prepared documents and periodic compliance reviews are a must for ongoing protection.
• Laws like GDPR and consumer rights still apply, so set up a joined-up compliance programme covering all angles of your online business.
• Expert legal support and industry guidance are readily available-don’t hesitate to seek advice and protect your business from day one.

If you’d like specific legal advice or help with Online Safety Act compliance for your UK business, you can reach us at team@sprintlaw.co.uk or call 08081347754 for a free, no-obligations chat. We’re here to help you lay strong legal foundations and grow with confidence-online and off.