Meta and TikTok have won a legal challenge against the methodology used by the European Union to calculate a supervisory fee. Under the Digital Services Act (DSA), the EU imposed a fee of 0.05% of a company’s annual worldwide net income to cover the cost of monitoring compliance. Both companies argued in court that the methodology was flawed, as it led to disproportionate fees by factoring in profit or loss and the number of active users.
The General Court in Luxembourg sided with Meta and TikTok, ruling that the EU regulators must reformulate the fee calculation method within 12 months. However, the court also stated that the companies will not receive a refund for their 2023 fees while a new legal basis is being developed. The European Commission has commented that the court’s decision confirms the soundness of the fee’s principle and amount, and it only requires a “purely formal correction” to the procedure.
