Meta and TikTok challenge tech fees in second highest EU court
Meta logo is seen in this illustration taken, August 22, 2022. REUTERS/Dado Ruvic/Illustration
LUXEMBOURG (Reuters) -Meta Platforms and TikTok said a European Union supervisory fee levied on them was disproportionate and based on a flawed methodology as they took their fight with tech regulators to Europe's second highest court on Wednesday.
Under the Digital Services Act that became law in 2022, the two companies and 16 others are subject to a supervisory fee amounting to 0.05% of their annual worldwide net income aimed at covering the European Commission's cost of monitoring their compliance with the law.
The size of the annual fee is based on the number of average monthly active users for each company and whether the company posts a profit or loss in the preceding financial year.
Meta told judges at the General Court it was not trying to avoid paying its fair share of the fee, but it questioned how the Commission had calculated the levy, saying it had been based on the revenue of the group rather than of the subsidiary.
Meta's lawyer Assimakis Komninos told the panel of five judges the company still did not know how the fee was calculated.
He said the provisions in the Digital Services Act, or DSA, "go against the letter and the spirit of the law, are totally untransparent with black boxes and have led to completely implausible and absurd results".
ByteDance-owned Chinese online social media platform TikTok was equally critical.
"What has happened here is anything but fair or proportionate. The fee has used inaccurate figures and discriminatory methods," TikTok lawyer Bill Batchelor told the court.
"It inflates TikTok's fees, requires it to pay, not just for itself, but for other platforms and disregards the excessive fee cap," he said.
He accused the Commission of double counting the companies' users, saying this was discriminatory because users switching between their mobile phones and laptops would then be counted twice.
He also said regulators had exceeded their legal power by setting the fee cap at the level of group profits.
Commission lawyer Lorna Armati rejected both companies' arguments and defended the Commission's use of group profit as a reference value to calculate the supervisory fee.
"When a group has consolidated accounts, it is the financial resources of the group as a whole that are available to that provider in order to bear the burden of the fee," she told the court.
"The providers had sufficient information to understand why and how the Commission used the numbers that it did and there is no question of any breach of their right to be heard now, unequal treatment," she said.
The Court is expected to issue its ruling next year.
The cases are T-55/24 Meta Platforms Ireland v Commission and T-58/24 TikTok Technology v Commission.
(Reporting by Foo Yun Chee; editing by Barbara Lewis)
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Focus Malaysia
3 hours ago
- Focus Malaysia
Chin Hin to procure AAC machinery from Shanghai-listed Jiangsu Teeyer for its 3rd manufacturing plant
CHIN Hin Group Bhd, Malaysia's leading integrated constriction conglomerate, has inked a memorandum of understanding (MOU) with Jiangsu Teeyer Intelligent Equipment Co Ltd, a leading global provider of autoclaved aerated concrete (AAC) production systems listed on the Shanghai Stock Exchange. The MOU entered into through the group's wholly-owned subsidiary Starken AAC Sdn Bhd signifies Chin Hin's strategic expansion into its third AAC manufacturing facility which is set to be situated adjacent to the group's existing factory in Serendah, Selangor. Scheduled for full production by May 31 next year, the new facility will significantly elevate the Chim Hin's production capabilities by adding a capacity of over one million cubic metres per year. Listed on the Shanghai Stock Exchange with a RM3.2 mil market capitalisation, Teeyer is globally acclaimed for its expertise in AAC production systems. With over 35 years in the industry and having exported nearly 150 production lines to over 20 countries, Teeyer is recognised for pioneering technological advancements such as the MES system for precise production management and being the first Chinese company to localise AAC cutting machinery. Currently, Chin Hin's two existing AAC plants have a combined production capacity of about 1.2 million cubic metres. With the addition of this third facility, the group's total AAC production capacity will rise to over 2.2 million cubic metres annually, hence further consolidating its leadership in the building materials industry. 'This strategic partnership with Teeyer is a significant milestone for Chin Hin as it substantially enhances our production capabilities and strengthens our competitive edge in the market,' commented Chin Hin Group's CEO (Building Materials Division) Ng Wai Luen. 'Moreover, Teeyer's extensive global experience and technological expertise align perfectly with our growth strategy to meet rising demand for sustainable and high-quality building materials in Malaysia and beyond.' To-date, Chin Hin has continued its commitment to innovation and sustainable growth by reinforcing its leadership position in Malaysia's integrated building materials industry. This collaboration aligns with the group's on-going efforts to invest in advanced manufacturing capabilities, driving operational efficiency and responding to the increasing market demand for environmentally friendly construction materials. At the close of today's (June 12) market trading, Chin Hin Group was up 3 sen or 1.44% to RM2.12 with 245,600 shares traded, thus valuing the company at RM7.51 bil. – June 12, 2025
The Star
3 hours ago
- The Star
Temasek joins Microsoft, BlackRock and MGX to develop AI infrastructure
FILE PHOTO: Temasek logo is seen in this illustration taken November 30, 2022. REUTERS/Dado Ruvic/Illustration/ File Photo SINGAPORE (Reuters) -Temasek has joined a consortium backed by Microsoft, BlackRock and tech investment company MGX to invest and expand artificial intelligence infrastructure, according to BlackRock's investor day presentation slides on Thursday. The Singapore state investment company has joined AI Infrastructure Partnership, a group that also includes BlackRock's Global Infrastructure Partners, the slides showed. AIP, formed in September with a goal to initially invest more than $30 billion in AI-related projects, is one of the world's largest efforts to invest in data centres and energy facilities needed to power AI applications such as ChatGPT. It aims to mobilise up to $100 billion including debt financing for such investments, which will focus on the United States. Temasek's participation comes after the Kuwait Investment Authority joined AIP earlier in June. The sovereign wealth fund of Kuwait was the first non-founder financial anchor investor to join the consortium, which also counts partners including Nvidia and billionaire Elon Musk's xAI. "Temasek's investment in the AI Infrastructure Partnership reflects our focus on the big shifts and trends of the future," Ravi Lambah, Temasek's head of strategic initiatives, said in an email to Reuters. "AI is potentially the most transformative and impactful technology for all sectors and businesses," he added. Temasek did not disclose financial details of the investment. The global investment company had a net portfolio value of S$389 billion ($304 billion) as of March 31, 2024, according to its website. ($1 = 1.2804 Singapore dollars) (Reporting by Yantoultra Ngui; Editing by Muralikumar Anantharaman)
The Star
5 hours ago
- The Star
Most G7 members ready to lower Russian oil price cap without US
FILE PHOTO: Russian flag with stock graph and an oil pump jack miniature model are seen in this illustration taken October 9, 2023. REUTERS/Dado Ruvic/Illustration/File photo BRUSSELS/PARIS (Reuters) -Most countries in the Group of Seven nations are prepared to go it alone and lower the G7 price cap on Russian oil even if U.S. President Donald Trump decides to opt out, four sources familiar with the matter said. G7 country leaders are due to meet on June 15-17 in Canada where they will discuss the price cap first agreed in late 2022. The cap was designed to allow Russian oil to be sold to third countries using Western insurance services provided the price was no more than $60 a barrel. The European Union and Britain have been pushing to lower the price for weeks after a fall in global oil prices made the current $60 cap nearly irrelevant. The sources, who declined to be named, said the EU and Britain are ready to lead the charge and go it alone, backed by the other European G7 countries and Canada. They said it is still unclear what the U.S. will decide, though the Europeans are pushing for a united decision at the meeting. Japan's position also remains uncertain, they said. "There is a push among European countries to reduce the oil price cap to $45 from $60. There are positive signals from Canada, Britain and possibly the Japanese. We will use the G7 to try to get the U.S. on board," one of the sources said. The White House had no immediate comment. During the G7 finance ministers meeting in the Canadian Rockies last month, U.S. Treasury Secretary Scott Bessent remained unconvinced there was a need to lower the cap, according to sources. However some U.S. Senators may endorse the idea, including Lindsay Graham, who in recent weeks told reporters he supports lowering the cap. Graham is pushing a hard-hitting new set of Russia sanctions that could impose steep tariffs on buyers of Russian oil. The EU has proposed lowering the price to $45 a barrel in its latest 18th package of sanctions. The package must have unanimity from member states in order for it to be adopted, which could take several weeks. Russia's largest export grade, Urals, trades at around a $10 a barrel discount to the Dated Brent benchmark out of Baltic ports. Brent futures have been trading below $70 a barrel since early April. Sources said Washington's buy-in was not essential to lower the cap owing to Britain's dominance in global shipping insurance, and the EU's influence on the Western rules-abiding tanker fleet. The U.S., however, does matter when it comes to dollar-denominated payments for oil and its banking system. The EU and its Western allies have been progressively cracking down on Russia's shadow fleet of tankers and related actors, which work to circumvent the cap. The pressure has started to hurt Moscow's revenues and Western allies hope this will push more of the oil trade back under the cap. Russia's state-owned oil producer Rosneft reported a 14.4% slump in profits last year. (Reporting by Julia Payne and John Irish; Additional reporting by Jarrett Renshaw in Washington; Editing by Jan Harvey)
