EU Court Upholds TikToks’s Gatekeeper Designation

The EU Court of Justice upheld the European Commission’s decision to designate ByteDance, TikTok’s parent company, as a gatekeeper under the Digital Markets Act (DMA), dismissing all arguments presented by the company. This ruling reinforces the EU’s efforts to regulate dominant tech companies and ensure fair competition in key internet sectors. The General Court, part of the Court of Justice of the EU, found that ByteDance’s potential to monetize users and its consolidated market position justified the Commission’s designation.

ByteDance had appealed the Commission’s designation, arguing that it did not hold an entrenched position in the digital advertising market and did not meet the DMA’s revenue threshold of €7.5 billion per year in the European Economic Area. However, the Court dismissed these claims, noting TikTok’s rapid growth and high engagement rates in the EU. The Court emphasized that ByteDance’s global market value and large number of EU users reflect its financial capacity and potential to monetize those users.

The ruling also dismissed ByteDance’s arguments of rights infringement and unequal treatment, stating that the Commission’s standard of proof was appropriate. The European Consumer Organisation (BEUC) welcomed the decision, highlighting ByteDance’s obligation to comply with DMA regulations on personalized advertising consent, thus bolstering user privacy.

A TikTok spokesperson expressed disappointment with the ruling but noted that the company has already taken measures to comply with the DMA’s obligations ahead of the March deadline. Despite ByteDance’s claims of being a market challenger, the Court found that TikTok’s substantial user base and rapid growth in the EU demonstrated a consolidated market position.

Source: EU Court upholds Commission decision to designate TikTok parent as gatekeeper