The European Commission (EC) has accused the operator of the Chinese platform TikTok of violating EU rules due to a lack of transparency in advertising. The Commission, which also acts as the EU’s antitrust authority, said this in a press release today. TikTok, which is owned by Chinese company ByteDance, can respond to the preliminary finding. However, if it fails to refute the Commission’s allegations, it faces a fine of up to 6% of its annual global turnover.
Criticism of TikTok
TikTok operates a platform for posting short videos. The Commission launched an investigation into the company in February last year on suspicion that it was not complying with the requirements of the EU’s Digital Services Act (DSA). It was concerned that TikTok had not published an ad repository, which would have made it easier to detect fraud.
“The Commission found that TikTok does not provide the necessary information about the content of ads, the users targeted by ads, or who paid for the ads. In addition, TikTok’s ad repository does not allow the public to comprehensively search for ads based on this information, which limits the usefulness of this tool,” the EC said.
TikTok faces record fine in the EU
TikTok has gained considerable popularity in recent years, especially among young people around the world. In Europe alone, it has approximately 175 million users. TikTok does not publish its financial results independently, but Bloomberg reported in April that ByteDance increased its revenue by 29 percent last year to approximately $155 billion. Various estimates suggest that TikTok alone had advertising revenues of around $24 billion last year and that revenues could reach as much as $33 billion this year.
Earlier this month, TikTok’s operator in the EU was fined €530 million for personal data protection shortcomings. The penalty was imposed by the Irish Data Protection Commission (DPC), acting on behalf of the EU. At the same time, it ordered TikTok to bring its data management into compliance with the requirements within six months or stop sending data about EU users to China. TikTok said it would appeal the decision.
Source: Reuters
