Meta and TikTok secured a legal victory in their battle against the European Union’s controversial tech fee structure. The fee, imposed under the EU’s Digital Services Act (DSA), aimed to make large digital platforms contribute to the costs of regulatory oversight. However, both companies argued the charges were unfair, disproportionate, and discriminatory.

What Triggered the Dispute

The European Commission introduced annual supervisory fees in 2023 to fund its oversight of digital giants. These costs, calculated based on the number of active users, heavily impacted platforms like Meta’s Facebook and TikTok. Smaller firms, however, were exempt, sparking criticism from bigger players who claimed the system penalized success.

Court Decision in Favor of Meta and TikTok

On Wednesday, the EU’s General Court ruled in favor of the companies, declaring the current fee model inconsistent with principles of fairness. Judges noted that the fees lacked transparent justification and placed disproportionate burdens on certain platforms compared to others.

Implications for EU Tech Regulation

The ruling is a setback for Brussels’ broader agenda to regulate Big Tech more stringently. While the DSA remains in force, the EU will now need to revisit how it finances its supervisory role. Regulators signaled they would revise the funding framework to ensure compliance with the judgment, possibly shifting to a more evenly distributed model.

Reactions from Companies and Regulators

Meta welcomed the decision, stating that it supports fair and balanced regulation but opposed arbitrary financial penalties. TikTok echoed this stance, emphasizing its commitment to working with EU authorities while ensuring business conditions remain equitable. EU officials, meanwhile, said they would “carefully assess” the ruling and prepare an alternative system to cover enforcement costs.

What’s Next for Tech Oversight in Europe

Analysts suggest the judgment may embolden other tech firms to challenge EU rules seen as discriminatory. The decision could also delay funding mechanisms for the Digital Services Act’s enforcement, forcing EU lawmakers to balance fairness with effective supervision of digital platforms.