The court in Luxembourg found the European Commission's methodology for supervisory fees under the Digital Services Act to be imperfect. The Commission was given a year to correct it, while the repayment of previously paid funds to companies is not currently foreseen. This is reported by Reuters, according to UNN.
Details
Meta and ByteDance, which owns TikTok, sued the European Commission after they were charged a supervisory fee of 0.05% of their annual net worldwide income to cover the EU executive's costs of monitoring their compliance with the Digital Services Act, the publication states.
The annual fee amount depends on the average number of active monthly users for each company and whether each of them made a profit or loss in the previous financial year. Both companies stated that the methodology was flawed, leading to disproportionate fees.
The General Court in Luxembourg sided with Meta and TikTok, giving European Union regulators 12 months to correct their methodology through another legal act.
This methodology... should have been adopted not in the context of implementing decisions, but in a delegated act, in accordance with the rules set out in the Digital Services Act (DSA)
At the same time, the court added that regulators do not yet need to return the fees paid by companies for 2023 while they develop a new legal framework used to determine the fee amount. The Commission stated that it saw no problems with either the principle of fee determination or its amount.
The Court's decision requires a purely formal correction of the procedure. Now we have 12 months to adopt a delegated act to formalize the fee calculation and adopt new implementing decisions
Addition
The Digital Services Act (DSA), which came into force in November 2022, obliges large online platforms to more actively combat illegal and harmful content on their resources. In case of violations, companies face fines of up to 6% of their annual worldwide turnover.
Among the platforms subject to these requirements and paying supervisory fees are Amazon, Apple, Booking.com, Google, Microsoft, and social networks X, Snapchat, and Pinterest.