Meta, TikTok take EU to court over online content rulebook

Social media giants Meta and TikTok are suing the European Union over a levy that bankrolls the enforcement of Europe’s content moderation law, the Digital Services Act.

Meta, which owns Instagram and Facebook, told POLITICO Wednesday it had filed a legal challenge before the EU’s General Court, arguing that the levy was unfair because some companies were paying nothing and others were left to pay a disproportionate amount of the total cost.

TikTok on Thursday followed suit, saying the Commission's method of calculating companies' contributions were "flawed."

The European Union executive has said it needs around €45 million in 2024 to police how major platforms like Meta’s Facebook and Instagram, TikTok and YouTube crack down on illegal and harmful content. It will fund that by collecting a supervisory fee from the companies every year.

Meta alone said it is required to pay €11 million for 2024. TikTok declined to say how much it is paying. The EU's decision that shows the costs per company is not public.

The lawsuits comes as the Commission faces high expectations to force large social media and websites to abide by the Digital Services Act’s obligations to stamp out toxic and violent content and better protect children online. The new rules are also a key instrument for EU officials to fight disinformation in the campaign for its European Parliament election in June.

Under the content moderation law, very large online platforms and search engines have to split the costs of enforcement based on user numbers, paying a maximum contribution of 0.05 percent of their yearly profit each year to the Commission.

But companies that only record very small or no net income — like Elon Musk’s X, Amazon, Snapchat, Pinterest and Wikipedia in 2022 — could escape a large levy, while Meta and Google are estimated to foot much of the bill.

The Commission previously said it would need €45.2 million and up to 150 staff in 2024 to supervise around two dozen very large online platforms and search engines that have over 45 million users in the EU.

“Our decision and methodology are solid. We will defend our position in court,” said Commission spokesperson Johannes Bahrke.

The Digital Services Act allows the Commission to impose hefty fines of up to 6 percent of companies’ global revenue.

Last year Amazon and fashion retailer Zalando also lodged separate legal challenges to the Digital Services Act, seeking to avoid extra obligations like turning off personalized algorithms. Amazon already won temporary relief from the law in August, when the EU’s highest court ruled the firm wouldn't immediately need to comply with part of the law requiring it to build a detailed public library for ads.

The Commission is currently investigating X for potentially failing to tackle illegal violent content and disinformation, particularly following the start of the Hamas-Israel war last year.

X and Pinterest did not immediately respond to a request for comment. Snap declined to comment on the record about its levy. Amazon also declined to comment.

Meta's court challenge is case T-55/24 Meta Platforms Ireland. TikTok's challenge is case T-55/24 Meta Platforms Ireland.

This article has been updated.