Meta and TikTok challenge tech fees in second highest EU court

Written by Fu Yun Chi

Luxembourg (Reuters) -Meta and Tiktok platforms said that the European Union supervising fees were incompatible and based on a defective methodology as they took their battle with technical organizers to the second highest court in Europe on Wednesday.

Under the Digital Services law that became the law in 2022, the two companies and 16 others are subject to supervisory fees of 0.05 % of its annual net income all over the world that aims to cover the cost of the European Commission to monitor its compliance with the law.

The size of the annual fees depends on the number of active monthly users for each company and whether the company is publishing a profit or loss in the previous fiscal year.

Mita Al -Qudah in the General Court told that she was not trying to avoid paying her fair share of fees, but she wondered how the committee is calculating for the tax, saying that it was based on the group’s revenues instead of the subsidiary company.

The Meta Assimakis Komninos’s lawyer told the five judges that the company still does not know how the fees were calculated.

He said that the provisions contained in the Digital Services Law, or DSA, “go against the message and the spirit of the law, completely not transparent with black boxes and led to completely unreasonable and ridiculous results.”

The Chinese social media platform online Tiktok was equally decisive.

“What happened here is a just or proportional thing. The drawings have used inaccurate personalities and discriminatory methods,” Tigkok’s lawyer Bill Patchalor told the court.

“He broke the fees of Tijook, and requires that he be paid, not only for himself, but for other platforms and ignore the maximum excessive fees,” he said.

The committee accused the double counting of corporate users, saying that this was discriminatory because the users who turn between their mobile phones and laptops will be calculated twice.

He also said that the organizers exceeded their legal authority by determining the ceiling of the fees at the group’s profits level.

The committee’s lawyer, Laurena Armati, rejected the arguments of the two companies and defended the committee’s use of the group’s profits as a reference value for the supervisory fees.

“When a set of unified accounts have, the group’s financial resources as a whole are available to this provider in order to bear the burden of fees,” she told the court.

She said: “Service providers had enough information to understand the reason and how the committee used the numbers that I did and there is no doubt about any violation of their right to listen now, as an unequal treatment.”