ByteDance loses court battle to appoint EU Gatekeeper

In a significant development for antitrust regulation, TikTok owner ByteDance has lost a legal battle to be designated as a watchdog under the European Union (EU) Digital Markets Act (DMA). The ruling by Luxembourg’s Supreme Court on Wednesday is a boost for EU regulators seeking to rein in Big Tech’s power.

The DMA imposes strict requirements on companies classified as gatekeepers. These include ensuring their messaging apps are interoperable with competitors’, allowing users to choose which apps are preinstalled on their devices, and prohibiting them from prioritizing their own services over those of rivals.

ByteDance argued that its designation as a gatekeeper could counteract the DMA’s objectives by protecting established companies from newer competitors, such as TikTok, which has no established market presence. But the court dismissed that argument, siding with the European Commission, the EU’s executive branch. The court found that ByteDance did not provide sufficient evidence to support its claims.

“The Commission was fully entitled to find that ByteDance acted as a gatekeeper,” the judges said. They also noted that ByteDance met the quantitative criteria of the DMA, including its global market value, the number of TikTok users in the EU and the period during which the number of users was maintained.

The ruling strengthens the EU’s stance on regulating major digital platforms and ensuring fair competition. ByteDance has the option to appeal the decision to the Court of Justice of the European Union, Europe’s highest court.

The case marks a key moment in EU regulators’ ongoing efforts to address the dominance of big tech companies and promote a more competitive digital market landscape. The decision underscores the rigorous enforcement of the DMA and sets a precedent for future cases involving other tech giants.

Source: Reuters