LUXEMBOURG CITY, Luxembourg: TikTok on May 12 urged Europe's highest court to overturn its designation as a "gatekeeper" under the European Union's Digital Markets Act, in a landmark case that could shape how the bloc regulates major technology companies.
The social media platform, owned by ByteDance, argues it does not meet the criteria for the designation, which subjects companies to tougher rules aimed at curbing market dominance and increasing competition.
The case is the first challenge to a gatekeeper designation to be heard by the Court of Justice of the European Union.
TikTok was designated a gatekeeper in September 2023 after the European Commission determined it had more than 45 million monthly users in the EU.
Other companies given the same status include Google, Meta Platforms, Apple, Amazon, Microsoft, and Booking.com.
A lower EU tribunal rejected TikTok's challenge in 2024, finding that the company met the requirements for gatekeeper status.
Under the Digital Markets Act, gatekeepers must comply with a wide range of obligations, and violations can result in fines of up to 10 percent of a company's annual global turnover.
TikTok's lawyer, Bill Batchelor, told the court the company does not have a sufficiently entrenched market position in Europe.
"ByteDance showed not only that its market cap is overwhelmingly derived from its Asian businesses but also that they had no connection to Europe, face different competitive dynamics and operate in a distinct regulatory, linguistic, and cultural environment," Batchelor said.
He also argued that most TikTok users regularly use competing platforms.
"We refer to this as 'multihoming.' That means businesses can reach the same end users via multiple other platforms," Batchelor said.
A lawyer for the European Commission rejected that argument.
"Lock-in can occur even when some degree of multihoming exists. For example, there may be specific user groups that depend on TikTok," Mislav Mataija told the court.
The judges are expected to rule in the coming months.
Meta Platforms is also challenging the gatekeeper designation of its Messenger and Marketplace services.
