The battle on European digital regulation intensified when the main technological platforms challenge the commissions of the law on digital services imposed by the European Union. Last Wednesday, the Meta and Tiktok platforms owned by Bytedance brought their cases before the EU court, claiming that the supervisory commissions are disproportionate and based on basicly imperfect calculations.
The main controversy
Pursuant to 2022 Digital Services Act, 20 main online platforms and two important search engines – including Google, Apple and others – are subject to an annual withdrawal of 0.05% of their net income all over the world.
The commissions of the digital services law are designed to cover the costs of the European Commission for the monitoring of compliance with the complete picture of digital regulation.
This structure of the commissions considers two main factors: the average number of monthly active users and if companies have recorded profits or losses in the previous year. However, both destination and Tiktok claim that the methodology behind these calculations is seriously imperfect.
The challenge of Meta
Second to Reuters relationshipThe lawyer of Meta, Assimakis Komninos, provided a strong criticism of the calculation process of the commissions, describing it as opaque and leading to “completely non -plausible and absurd results”. The main objections of the company focus on the decision of the Commission to base the calculations on the revenue of the group rather than on the income of the individual branches.
Komninos stressed that destination still lacks a full understanding of how his specific commission has been calculated, highlighting a lack of transparency in the process. The company stressed that he was not trying to avoid paying his equitable share, but he questioned the fundamental methodology used to determine the amount.
The accusations of Tiktok
On the other hand, Tiktok’s legal team, led by the lawyer Bill Batchelor, has launched criticisms equally stopped at the methodology of digital services commissions. Batchelor characterized the approach as “inaccurate” and “discriminatory”, indicating specific technical problems in the methods of counting users.
The company argues that the Commission has inflated user numbers from people with two containers passing from different devices, a common practice in today’s multi-administrative digital environment. Tiktok also claims that the commissions structure unjustly includes the costs associated with other platforms and exceeds the limits of the legally mandatory commissions.
Defense of the Commission
The European Commission, represented by the lawyer Lorna Armati, vigorously defended his approach. Army claimed that the use of group profits as a reference point for the calculations of the commissions of the digital services law was appropriate and legally valid.
He claimed that both companies possessed adequate information to understand the methodology and that the Commission’s approach has fully respected the established legal standards.
Wider implications
The legal challenge involves significant implications beyond the immediate financial impact on Meta and Tiktok. The result could establish important precedents for how the digital regulation commissions in the European Union are calculated and implemented.
With 22 main platforms currently subject to these accusations, the Court’s decision will probably influence relations in the wider technological sector with EU regulators.
The dispute also highlights the ongoing tensions between the giants of American technology and European regulatory authorities, which have increasingly tried to establish supervision mechanisms for digital platforms operating on the EU boundaries.
What’s the next
The General Court will be issued its sentence next year, although the exact time sequence remains unclear. The decision will probably influence not only how the commissions of the digital services law in the future are calculated, but potentially also affect other aspects of the complete framework of digital regulation.
The observers of the sector are observing up close, since the case could create important precedents for future structures of the regulatory commissions and the balance between the supervision of the platform and fair calculation methodologies. The result can also influence the way in which other jurisdictions approach the regulation of the digital platform and the commissions structures.
For now, the platforms concerned must continue to pay the contested commissions pending the decision of the Court, making this a high -risk legal battle with significant financial and regulatory implications for the digital economy.
See also: Meta, Tiktok faces a legal challenge for half a billion dollars in Brazil for minor protection
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