Meta, TikTok challenge EU tech fee in Court

Meta Platforms and TikTok have taken their fight against an EU tech fee to Europe’s second highest court.

They argue the fee is unfair and based on flawed calculations.

Under the Digital Services Act (DSA), which became law in 2022, the companies must pay a supervisory fee.

The fee amounts to 0.05% of their global annual net income.

It helps cover the European Commission’s cost of monitoring compliance.

The size of the fee depends on each company’s average monthly users and financial results from the previous year.

Meta told the General Court it does not oppose paying.

But it disagrees with how the Commission calculated the fee.

Meta says the fee was based on group-wide revenue instead of that of the local subsidiary.

Meta’s lawyer, Assimakis Komninos, told judges: “The provisions in the Digital Services Act, or DSA, go against the letter and the spirit of the law, are totally untransparent with black boxes and have led to completely implausible and absurd results.”

He said Meta still doesn’t know how the final amount was worked out.

TikTok, owned by ByteDance, raised similar objections.

TikTok’s lawyer, Bill Batchelor, said: “What has happened here is anything but fair or proportionate. The fee has used inaccurate figures and discriminatory methods.”

He added: “It inflates TikTok’s fees, requires it to pay, not just for itself, but for other platforms and disregards the excessive fee cap.”

Batchelor accused the Commission of double-counting users.

He explained this happens when users switch between devices.

He also said regulators overstepped their powers by using group profits to set the cap.

The European Commission pushed back.

Its lawyer, Lorna Armati, defended the method.

“When a group has consolidated accounts, it is the financial resources of the group as a whole that are available to that provider in order to bear the burden of the fee,” she told the court.

She added: “The providers had sufficient information to understand why and how the Commission used the numbers that it did and there is no question of any breach of their right to be heard now, unequal treatment.”

The court is expected to rule next year.

The cases are T-55/24 Meta Platforms Ireland v Commission and T-58/24 TikTok Technology v Commission.

(Reuters)

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