The owners of TikTok have just lost a major appeal against the categorization of being an EU gatekeeper.
Bytedance which has its roots in China had filed an appeal after it was allotted the label that came under the Digital Markets Act.
The owners of the company took the decision to make the appeal as it didn’t agree with the terminology that designates certain additional responsibilities for the company. There were plenty of clauses that it said it didn't agree with from the start.
As per the European Commission, the court in Luxembourg ruled how such categorization was related to the great impact that its TikTok app had on young minds, exceeding the thresholds related to value in the global market as well as the number of members it had across the EU.
As per the court’s findings, ByteDance kept on arguing how most of its members arise from China and not the European region. Moreover, under such a label, all firms must first obtain consent from users to get access to certain services and features like data collection for personalized ad targeting practices.
The court also argued how TikTok is not operational on an exponential user model for expansion, hence it behaves as a challenge to other digital archrivals including Meta’s apps and those belonging to Google owner Alphabet. Both the former and latter companies come under this label of being digital gatekeepers too.
The European General Court rejected all of these court findings and found TikTok not working as a challenger in today’s industry, unlike what we saw in 2018.
Judges ended up closing the argument by claiming TikTok succeeded in building up figures for users that continued to rise quickly and exponentially. Today, it’s got a huge user base in the EU and therefore that enhances its contribution in attaining a bigger market value worldwide.
A representative from TikTok’s parent firm argued how the company was very upset with the rejection of its appeal and the final decision rolled out on this front. They insist TikTok is an existing challenger in today’s growing market.
The rep kept on reiterating how the app took plenty of measures to comply with the necessary rules aligned with the DMA since the start of March of this year, which is when it came into effect.
On the other end of the extreme, the BEUC took the decision positively and felt it was great news. It added how TikTok needed to attain consent from its giant userbase before it could use their personal data for targeted ads.
Other than ByteDance, we know more about how the Digital Markets Act would similarly apply to operations of leading tech giants from the US like Amazon, Meta, Microsoft, Apple, and even Alphabet working in the vicinity of the European Union since the start of May.
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