Yazılar

Meta and TikTok Win EU Court Challenge on Tech Fees, Regulators Must Recalculate

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Meta Platforms and TikTok secured a legal victory on Wednesday against the European Commission over the way EU regulators calculated supervisory fees under the Digital Services Act (DSA). The General Court in Luxembourg ruled that the methodology used to determine the fees was flawed and must be reworked.

Both companies had challenged the 0.05% levy on annual worldwide net income, arguing the system unfairly imposed disproportionate costs. The fee is intended to fund the EU’s monitoring of large platforms’ compliance with the DSA, which requires them to better police harmful and illegal online content.

Court Ruling

The judges said the fee calculation method should have been set under a delegated act, rather than through implementing decisions, giving regulators 12 months to fix the legal framework. Importantly, the court said fees already paid for 2023 will not be reimbursed.

Reactions

  • The European Commission said the ruling requires only a “formal correction” and that it will adopt a delegated act to formalize the methodology.

  • TikTok welcomed the decision, pledging to monitor the new process.

  • Meta emphasized that the current system unfairly burdens profitable companies while large loss-making platforms avoid payment, despite imposing heavy regulatory costs.

Wider Context

The DSA, which came into effect in November 2022, gives the EU sweeping oversight powers and allows fines of up to 6% of global turnover for non-compliance. Other major platforms subject to supervisory fees include Amazon, Apple, Google, Microsoft, Booking.com, X (formerly Twitter), Snapchat, and Pinterest.

The cases were filed under references T-55/24 (Meta Platforms Ireland v Commission) and T-58/24 (TikTok Technology v Commission).

Zalando Challenges EU Tech Regulations, Argues It Shouldn’t Be Classified as a Very Large Online Platform

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Zalando, Europe’s largest online fashion retailer, has criticized EU regulators for classifying it alongside major platforms like Amazon and AliExpress under the bloc’s Digital Services Act (DSA). The company argues that its business model is fundamentally different, and thus it should not be subject to the same stringent provisions that apply to the other two tech giants.

The DSA, which came into force in 2022, imposes more responsibilities on very large online platforms (VLOPs) to combat illegal and harmful content, with fines of up to 6% of their global annual revenue for non-compliance. Zalando’s lawyer, Robert Briske, told the General Court that the European Commission had failed to properly recognize the differences between Zalando and companies like Amazon, AliExpress, and booking.com. He emphasized that Zalando operates a hybrid business model, combining both direct retail and a marketplace for third-party sellers, which sets it apart from purely online shops or marketplaces.

Zalando contends that the Commission’s designation of its active users as 83 million is inaccurate. The company argues that only 30.8 million of those visitors qualify as active users in 2023, the year it was classified as a VLOP. Briske stated that this miscalculation was another key issue in the case.

In response, EU Commission lawyer Liane Wildpanner defended the classification, asserting that Zalando’s model is similar to that of Amazon and AliExpress, both of which also offer hybrid services. Wildpanner argued that Zalando was attempting to “have the best of both worlds” by challenging its VLOP designation.

Zalando has garnered support from Germany’s e-commerce association, BEVH, while the European Information Society Institute, the European Parliament, and the Council of the European Union have sided with the Commission. The General Court is expected to issue its ruling in the coming months. Amazon, too, has challenged the Commission’s VLOP designation and is awaiting a hearing date.

EU Court Imposes Fine on EU for Breaching Own Data Protection Law

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In a landmark decision, the EU General Court ruled on Wednesday that the European Commission must pay compensation to a German citizen for breaching its own data protection laws. The court found that the Commission transferred the citizen’s personal data to the United States without adequate safeguards, in violation of the EU’s General Data Protection Regulation (GDPR).

The case stemmed from the individual using the “Sign in with Facebook” option to register for a conference via the EU login page. The court concluded that the Commission’s transfer of the user’s IP address to Meta Platforms in the U.S. was unlawful, as it did not meet the required data protection standards set out by the GDPR. As a result, the Commission was ordered to pay the citizen 400 euros ($412) in damages.

A spokesperson for the European Commission acknowledged the ruling and stated that it would carefully assess the judgment and its implications. This decision marks a significant development in the enforcement of GDPR, a regulation widely considered to be among the most robust data privacy laws globally. Many major companies, including Meta, LinkedIn, and Klarna, have faced heavy fines from the EU for failing to comply with these regulations.