TikTok to Permanently Withdraw TikTok Lite Rewards Program in EU Following Digital Services Act Compliance Order

The European Commission has accepted TikTok's commitment to permanently withdraw its TikTok Lite Rewards program from the European Union. This move comes as part of TikTok's efforts to comply with the stringent requirements of the Digital Services Act (DSA), following concerns raised by the Commission earlier this year.

TikTok’s commitment to permanently withdraw the TikTok Lite Rewards program, along with a promise not to introduce any similar programs that could circumvent this withdrawal, has now been made legally binding by the Commission. This means that any violation of these commitments would constitute a direct breach of the DSA, potentially resulting in substantial fines.

This decision marks the closure of the formal proceedings initiated against TikTok on April 22, 2024, just 105 days after the case was opened. This is the first instance where the European Commission has accepted commitments from a designated online platform as a resolution under the DSA, setting a precedent for future regulatory actions.

TikTok Lite Rewards Program: The Concerns

The TikTok Lite Rewards program, which was launched in Spain and France in April 2024, allowed users to earn points by performing tasks on the TikTok Lite app, such as watching videos, liking content, and inviting friends to join the platform. However, the European Commission expressed significant concerns that the program was introduced without a proper risk assessment, particularly regarding its potential to encourage addictive behavior.

The Commission was particularly concerned about the potential negative impact on minors, who are more vulnerable to addictive features in digital platforms. Under the DSA, Very Large Online Platforms (VLOPs) like TikTok are required to perform comprehensive risk assessments and implement effective risk mitigation measures before launching any new functionalities that could significantly impact systemic risks.

TikTok's failure to provide a risk assessment report led the Commission to open formal proceedings in April 2024, with a warning that the TikTok Lite Rewards program could be suspended in the EU. TikTok voluntarily suspended the program two days later, on April 24, but today's decision ensures the program will not return.

Ongoing Scrutiny and Future Compliance

While the Commission has closed this particular case, TikTok remains under scrutiny for other ongoing issues. The first formal proceedings against TikTok, which began in February 2024, are still active, with the investigation continuing. The Commission has also opened formal proceedings against other major platforms, including X, AliExpress, and Meta, under the DSA.

The European Commission will closely monitor TikTok's adherence to its commitments under the DSA, as well as its overall compliance with the Act’s broader obligations. The binding nature of today’s commitments underscores the seriousness with which the Commission is approaching the regulation of digital platforms, particularly those with significant influence over users' online experiences.

Implications for Digital Platforms and Compliance Professionals

This case serves as a crucial reminder for digital platforms operating within the EU of the need to rigorously assess and mitigate risks associated with new features and programs. Compliance professionals should take note of the proactive stance the Commission is taking under the DSA, particularly the swift action taken in this case, and the precedent it sets for future regulatory enforcement.

Platforms must ensure that any new initiatives, particularly those with potential systemic impacts, undergo thorough risk assessments and align with the DSA’s requirements. Failure to do so could result in not only the suspension of such programs but also substantial legal and financial consequences.

As the Digital Services Act continues to reshape the regulatory landscape for online platforms in Europe, this case highlights the critical importance of compliance and the potential ramifications of falling short of these new regulatory standards.

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