DSA: EU court overturns pro forma supervisory fees for large online platforms

The social media giants Meta and TikTok can celebrate at least a partial success with their lawsuit against the EU over a levy with which the EU Commission intends to finance the enforcement of the Digital Services Act (DSA). In two rulings announced on Wednesday, the General Court of the EU (GC) declared the decisions of the Brussels government institution to set the supervisory fee applicable to Facebook, Instagram, and TikTok null and void for formal reasons. However, the operators of the social networks must still pay their fees for 2023 for now: the Luxembourg judges have decided that the overturned implementing decisions will continue to have effect for a temporary period.

The DSA stipulates that very large online platforms with over 45 million annual EU users, known as VLOPs, must pay an annual fee to the Commission. This money is intended to cover the costs of monitoring and controlling digital services. The EU legislators specified the maximum amount for this: it is up to 0.05 percent of the global annual turnover of the companies concerned.

The executive body then calculated the exact amount of the fees based on the monthly user figures. It used a special formula for this purpose. However, this method should have been set out in a special regulation and not just in the fee notices themselves, the ECJ recently ruled in its decisions in cases T-55/24 and T-58/24. The Commission had thus violated the rules of the DSA. At the same time, however, the judges gave the government body up to 12 months to rectify its formal error, correctly determine the calculation method, and issue new fee notices.

Meta to pay 11 million for 2024

Both parties have two months and ten days from the date of notification to lodge an appeal against the ECJ decisions. The European Court of Justice (ECJ) would then decide on this.

According to the Brussels-based government institution, it will need around 45 million euros in 2024 alone to monitor whether and how VLOPs and YouTube take action against illegal and harmful content on a DSA basis with the help of 150 employees. The Digital Services Act generally provides for such operators to share the financial burden of their control via fees in accordance with the polluter pays principle. The Facebook and Instagram parent company, Meta, previously assumed that it would be asked to pay 11 million euros for 2024.

Amazon and Zalando filed more extensive lawsuits against the DSA. They would rather not be classified as VLOPs at all. Zalando's lawsuit was dismissed by the EGC last week. The online retailer must therefore reduce systemic risks under the DSA but has announced an appeal.

(mma)