Meta, TikTok win legal battle against European Union

Meta Platforms and TikTok won a legal challenge against the European Commission’s fee calculation method under the Digital Services Act (DSA), though both companies must continue payments while regulators reformulate the levy within 12 months.

The Luxembourg-based court ruled the EU’s supervisory fee methodology required adoption through a delegated act rather than implementing decisions.

The companies had opposed the 0.05% annual after tax income fee, disagreeing the calculation, based on monthly active platforms users and profitability, resulted in disproportionate charges.

Judges upheld the fee’s principle and amount but mandated procedural corrections, requiring regulators to formalize calculations through proper legal channels.

A Commission spokesperson confirmed: "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."

The ruling validates the fee structure while requiring purely formal correction on the procedure.

The DSA, which took effect in November 2022, imposes content moderation requirements on large platforms with non-compliance fines reaching 6% of global turnover.

Few tech giants, who are paying the governance fee includes Amazon, Apple, Google, Microsoft, X, Snapchat, and Pinterest.

The Commission retains collected 2023 fees during the recalibration period, maintaining funding for ongoing oversight of tech giant compliance with EU digital regulations.