BRUSSELS: Meta Platforms and TikTok have successfully challenged how European Union regulators calculated a supervisory fee imposed under the Digital Services Act (DSA), forcing officials to revisit the levy — though the companies will not be reimbursed for payments already made.
The Luxembourg-based General Court ruled that the European Commission used the wrong legal instrument in setting the fee methodology, giving regulators 12 months to adopt a delegated act to fix the process.
“That methodology… should have been adopted not in the context of implementing decisions but in a delegated act, in accordance with the rules laid down in the DSA,” the judges said.
The decision means the 2023 fees stand, but the framework for calculating future levies will need to be reworked.
How the fee was applied
Meta and ByteDance’s TikTok had been required to pay 0.05% of their annual worldwide net income to cover the Commission’s costs for monitoring compliance with the DSA, which came into effect in November 2022.
The fee is based on the average monthly active users of a platform and whether it posted a profit or loss in the previous financial year. Both companies argued the system was flawed and left profitable firms paying disproportionate shares compared to large but loss-making platforms.
A Meta spokesperson welcomed the ruling:
“Currently, companies that record a loss don’t have to pay, even if they have a large user base or represent a greater regulatory burden, leaving others to pay a larger and disproportionate amount of the total. We look forward to the flaws in the methodology being addressed.”
TikTok also said it would closely monitor the development of the delegated act.
Commission response
The European Commission insisted the principle of the fee and its amounts remain sound, describing the ruling as a procedural issue.
“The Court’s ruling requires a purely formal correction on the procedure. We now have 12 months to adopt a delegated act to formalise the fee calculation and adopt new implementing decisions,” a spokesperson said.
Broader impact
The DSA requires very large online platforms to tackle illegal and harmful content or risk fines of up to 6% of global turnover. Companies subject to supervisory fees also include Amazon, Apple, Booking.com, Google, Microsoft, X (formerly Twitter), Snapchat, and Pinterest.
The legal challenges, T-55/24 (Meta Platforms Ireland v Commission) and T-58/24 (TikTok Technology v Commission), underscore how disputes over compliance costs are shaping the next phase of Europe’s tech regulation.
