High Court grants TikTok stay on suspension of data transfers to China

Irish Examiner

3 days ago

A High Court judge has granted TikTok a stay on a decision by the Data Protection Commission (DPC) that the social media giant must suspend data transfers to China by November 29.
Mr Justice Mark Sanfey said the stay would be in place until early October when the court will hear an application by TikTok seeking a longer stay until the court hears the full challenge to the DPC decision which included a €530m fine on TikTok.
The judge, who heads the Commercial Court, also granted TikTok an application to have the case admitted to the fast-track commercial list. The court heard there was no objection to entry from the DPC.
The judge was told TikTok are claiming they face billions in losses if the decision stands and if they did not get a stay until the full case is heard.
He said the justice of the case required he would grant a stay until October. The court could not hear an application for the stay in July, as TikTok wanted, because the DPC needed time to prepare its case to oppose the stay.
Earlier, Declan McGrath SC, for TikTok, said his client estimates losses post the suspension will run into billions with losses already running at €109m. He was very much pressing the case for an interim stay on the suspension decision.
Counsel said the DPC decision is that data transfers from countries in the European Economic Area (EEA) - which includes all the EU along with Iceland, Liechtenstein, and Norway - to China must cease.
The data is not in China and is stored outside but Chinese engineers can access it. The DPC order requires that this remote access is to cease and that the processing of the data must be brought into compliance which addresses potential issues around storing of data.
The date on which this "corrective order" takes place is six months from 28 days after the order is made which is the period within which an appeal must be brought. That means there must be compliance by November 29, counsel said.
TikTok is also required to show by July that it has taken steps towards compliance, how it is to be implemented and how it will be communicated to service users within the EEA, he said. This was also why there was an urgency to the stay application.
The cost of this to TikTok will include having to relocate engineers and hire new ones in the EEA and other irreversible steps which represent damages that cannot be recouped, he said. It also impacts on taxation and other matters, including loss of goodwill.
Kelley Smith SC, for the DPC, said she was not in a position to agree to any of Mr McGrath's application. She said earlier his side needed time to prepare given the volume of paperwork in the case.
Mr Justice Sanfey approved directions for the progress of the stay application in October and said the case could also be mentioned before a vacation sitting of the Commercial Court in September.