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Instagram, Facebook, and TikTok do not have to pay fees demanded by the EU’s Digital Services Act (DSA) for regulatory supervision costs until the European Commission revises its method for collecting these fees, the EU’s General Court ruled on Wednesday.
These social media platforms contested the fees established under the DSA, which came into effect in 2023. The DSA requires the Commission to levy annual contributions from the biggest online platforms to fund the oversight, administrative, and human resource expenses related to supervision and enforcement activities.
The fees are based on a formula that considers the number of users each platform has but limits the fee at 0.05% of the provider’s global profits from the previous year.
After classifying Facebook, Instagram, and TikTok as Very Large Online Platforms (VLOPs), due to having over 45 million monthly users, the EU determined the supervisory fee for each in 2023.
The court has now invalidated these implementing decisions, although it has permitted their effects to remain temporarily.
The court’s ruling stated that the Commission’s computation of the average monthly active users of the services, using a shared method, should have been established in a delegated act rather than within the implementing decisions, as it is a crucial element in determining the fee.
The Commission is now given a 12-month period to establish the methodology for calculating the number of average monthly active users in accordance with the DSA and adopt new implementing decisions.
In a statement, the Commission acknowledged the ruling, emphasizing that the methodology has been deemed sound with no calculation errors, no suspension of payments, and no issue with the fee’s principle or amount. The concerned companies are still required to pay the supervisory fee for 2023.
Euronews reported in March that the EU levied a total of €58.2 million in supervisory fees from the largest online platform providers in the EU in 2023.
The collected fees in 2023, however, did not cover all of the Commission’s DSA-related expenses, resulting in a deficit of €514,061.
