Meta And TikTok Win Lawsuit Over EU Supervision Costs, Regulators Must Recalculate

Meta Platforms Inc. won a lawsuit regarding the way EU regulators (EU) (photo; x @jawad_Shah_)

JAKARTA Meta Platforms Inc., and TikTok on Wednesday 10 September won legal lawsuits over the way EU regulators calculate surveillance costs charged to them based on new technology rules. However, both companies will not accept refunds for 2023 costs, while EU officials are required to rearrange their calculation methods.

Meta and TikTok, owned by ByteDance, previously sued the European Commission after being charged 0.05% of their annual global net income. This cost is aimed at covering the cost of compliance monitoring the Digital Service Act (DSA).

The amount of the fee is calculated based on the average number of monthly active users and the company's financial condition in the previous year. However, Meta and TikTok assessed that the calculation method was flawed, resulting in a disproportionate cost burden.

The Luxembourg-based European Union General Court approved the lawsuits of the two companies and gave EU regulators 12 months to improve the methodology by using different legal grounds.

The methodology should have been adopted not through an implementation decision, but through the actions of the delegation in accordance with the rules in the DSA, the judge said.

Even so, the court confirmed that regulators do not need to return the 2023 fee that has been paid by the company, while waiting for a new legal basis for the calculation.

The European Commission stated that the court's decision only demanded procedural corrections. "We now have 12 months to adopt the delegation's actions to formalize the cost calculation and issue a new implementation decision," a Commission spokesman said.

TikTok welcomed the decision. "We will closely follow the progress of the delegation's actions," said a TikTok spokesperson.

Meta also said it was satisfied with the ruling. "Currently, companies that record losses are not required to pay, even if they have a large user base or cause a larger regulatory burden, so other companies must bear a larger portion disproportionately. We hope the shortfall in this methodology will be fixed soon," said a Meta representative.

The DSA, which has been in effect since November 2022, requires very large online platforms to be more active in dealing with illegal and harmful content, or facing fines of up to 6% of annual global turnover.

Apart from Meta and TikTok, other companies that are required to pay surveillance costs include Amazon, Apple, Booking.com, Google, Microsoft, Elon Musk's X, Snapchat, and Pinterest.