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US passes bill that could lead to TikTok ban, leaving the Chinese-owned app with an uncertain fate. Credit: TikTok
The European Commission has opened a formal investigation into TikTok to assess potential violations of the Digital Services Act (DSA). Companies found in breach of the act could face fines of up to 6% of their global revenue.
Launched on Monday, the investigation into the Chinese-owned platform will involve looking at various aspects of TikTok’s operations including safeguarding of minors, ensuring advertising transparency, facilitating access to data for researchers, and managing the risks associated with addictive and harmful content.
Why it matters: The move extends the EU’s investigation of the ByteDance-led video-sharing app from previous concerns regarding its handling of disinformation related to content around Hamas and its management of children’s accounts, and intensifies the company’s immediate need to address the escalating scrutiny of major tech firms by the EU.
Details: TikTok was defined as a Very Large Online Platform (VLOP) by the European Commission under the DSA in April 2023, following its announcement of 135.9 million monthly active users in the EU.
The European Commission believes that TikTok’s algorithms in the EU are designed to induce a “rabbit hole effect” on users, referring to the tendency of users to become immersed in online content and potentially distance themselves from real-life experiences.
In response, TikTok said it will continue to work with experts and the industry to ensure young people are safe on its platform and that it looks forward to explaining this work in detail to the European Commission.
The investigation comes just days after the short video app lost a court battle to suspend its designation as a gatekeeper, which requires companies with significant economic power and market influence to comply with a series of regulations under EU rules in the areas of advertising, user data, and intermediary services.
Context: In 2023, the Douyin sister app was fined €345 million in Ireland and £12.7 million in the UK by local regulators, who cited violations of the law in the platform’s handling of children’s account data.
Cheyenne Dong is a tech reporter now based in Shanghai. She covers e-commerce and retail, AI, and blockchain. Connect with her via e-mail: cheyenne.dong[a]technode.com.
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