TikTok Faces New Regulatory Challenges in Europe

TikTok is currently contending with a new wave of regulatory scrutiny within Europe. Consumer advocacy groups have submitted a series of synchronized complaints, citing numerous violations of EU legislation.

Coordinated Complaints Filed Across Europe

The European Consumer Organisation (BEUC) has formally filed a complaint with the European Commission and the network of consumer protection authorities throughout the EU. Simultaneously, consumer organizations in fifteen different countries have notified their respective national authorities.

These organizations are requesting thorough investigations into the practices of the prominent social media platform, as stated by BEUC today.

Specific Allegations Against TikTok

The complaints encompass several key areas of concern. These include allegations of unjust contractual terms, particularly regarding copyright and the use of TikTok’s virtual currency.

Further concerns center on the nature of content accessible to children on the platform. Accusations of deceptive data processing and inadequate privacy practices are also prominent.

Detailed Reports Outline Alleged Breaches

Two accompanying reports detail the specifics of the alleged violations. One report addresses issues related to TikTok’s consumer protection measures.

The second report concentrates on data protection and privacy concerns. These reports provide a comprehensive overview of the issues raised by the consumer groups.

Further Information

Additional details regarding this matter can be found in a recent post on Twitter: https://twitter.com/maryantfp/status/1361573024764411906.

Child Safety Concerns Regarding TikTok

The recent report levels accusations against TikTok, asserting a lack of sufficient measures to safeguard children and adolescents from concealed advertising and potentially detrimental content disseminated through its platform.

According to the findings, TikTok’s advertising practices contribute to the spread of surreptitious marketing techniques. Users are frequently prompted to engage in branded hashtag challenges, incentivized to produce content featuring specific products. The commercial nature of these challenges is often obscured, particularly when initiated by prominent influencers.

Hidden Advertising and Inappropriate Content

The report further suggests potential deficiencies in TikTok’s oversight regarding inappropriate content. Videos containing suggestive material are reportedly easily accessible, requiring only minimal scrolling to encounter.

This isn't the first time TikTok has faced scrutiny. Earlier this year, a regulatory action was taken in Italy following child safety issues, specifically after the tragic death of a 10-year-old girl.

Reports indicated the child succumbed to asphyxiation while participating in a “blackout” challenge on TikTok, prompting an emergency response from the Italian Data Protection Authority (DPA).

Age Verification Weaknesses

In response, TikTok agreed to reinstate an age gate designed to verify user ages in Italy. However, the implementation is considered inadequate, relying solely on self-reported birthdates, making it easily bypassable.

The BEUC report highlights the ineffectiveness of TikTok’s age gate, stating that underage users can readily register due to the loose and self-declaratory verification process.

Despite TikTok’s privacy policy stating the service isn't intended for users under 13, the report cites studies demonstrating significant TikTok usage among younger children. The consumer group suggests that children constitute a substantial portion of TikTok’s overall user base.

Ineffective Age Checks Across Platforms

The report includes the following observation:

A recent study supported by the EU also concluded that age verification systems on popular social media platforms are “basically ineffective,” as children can easily circumvent them by providing false age information.

TikTok’s current measures are therefore deemed insufficient to protect vulnerable young users from potentially harmful experiences.

• Hidden advertising poses a risk through branded hashtag challenges.
• Inappropriate content is readily accessible.
• The age verification process is easily circumvented.

These findings underscore the need for more robust safety protocols on the TikTok platform.

Terms of Use Concerns

Complaints have brought to light concerns regarding potentially unfair terms of use implemented by TikTok. These concerns specifically address copyright stipulations, with BEUC observing that TikTok’s terms and conditions grant it a perpetual and unrestricted license to utilize, disseminate, and replicate user-uploaded videos, all without providing any form of compensation.

Virtual Currency Issues

The platform’s virtual currency system is also identified as a source of potential consumer detriment. TikTok allows users to acquire digital coins, which are then used to purchase virtual gifts for other creators.

These gifts can subsequently be converted back into traditional currency by the recipient. However, BEUC alleges that TikTok’s “Virtual Item Policy” incorporates “unfair terms and misleading practices.”

Exchange Rate Manipulation

Specifically, the policy grants TikTok an “absolute right” to alter the conversion rate between the virtual coins and the gifts. This capability could potentially manipulate the financial transaction to benefit TikTok at the expense of its users.

Lack of Transparency

While TikTok clearly displays the cost of purchasing virtual coin packages, the process governing the conversion of these gifts into in-app diamonds remains unclear. These diamonds are redeemable by users for actual money, typically delivered through platforms like PayPal or other payment processors.

The ultimate monetary compensation received by content creators remains ambiguous. BEUC’s report notes that TikTok calculates compensation “based on various factors including the number of diamonds that the user has accrued,” but fails to disclose the portion of revenue retained by the application itself.

Consumer Rights Implications

“Although seemingly innocuous, TikTok’s Virtual Item Policy presents significant issues from a consumer rights perspective,” BEUC concludes. The lack of transparency and potential for manipulation raise serious questions about fair practices on the platform.

Privacy Concerns Regarding TikTok

Allegations of “misleading” practices have been leveled against the social media platform TikTok, particularly concerning data protection and privacy, including issues relating to child users. The submitted complaint asserts that TikTok does not adequately inform users regarding the types of personal data collected, the purposes for its use, and the legal justification – as mandated by Europe’s General Data Protection Regulation (GDPR).

Further concerns highlighted in the report encompass the absence of an option to opt-out of personal data processing for advertising purposes – often referred to as “forced consent,” a practice previously attributed to tech companies like Facebook and Google. Additionally, the report cites a lack of explicit consent for handling sensitive personal data, which receives heightened protection under GDPR, and insufficient security measures integrated into the design of its data protection systems.

Contact has been made with the Irish Data Protection Commission (DPC), TikTok’s primary data protection supervisor within the EU, regarding this complaint. An update will be provided upon receipt of a response. Update: The DPC has informed us that no further complaints have been formally referred to them at this time.

The DPC is currently reviewing the measures implemented by TikTok to safeguard the personal data of minors, in collaboration with the Garante (Italian Data Protection Authority).

Jef Ausloos, a postdoctoral researcher involved in the legal analysis of TikTok’s privacy policy for the data protection complaints, revealed that researchers were prepared to submit complaints a year ago. However, the platform implemented significant operational changes at that time.

Ausloos posits that these abrupt, large-scale alterations may be a calculated strategy to circumvent regulatory oversight of data exploitation practices. He explains that “constant flux” can disrupt and potentially reset research efforts aimed at establishing a basis for enforcement, while also noting that regulators with limited resources may hesitate to pursue cases against companies after practices have been modified.

Consequently, iterative breaches may go unenforced, allowing for repeated violations of the law.

It is a common response from platforms facing scrutiny over specific business practices to assert that they have since altered their operations, attempting to leverage this as a defense to mitigate the impact of regulatory enforcement or legal judgments. This approach can be summarized as “move fast and disregard regulatory accountability.”

Despite this, Ausloos expresses hope that the two years of documentation compiled on the TikTok case will assist DPAs in building robust legal cases.

Monique Goyens, DG of BEUC, stated in a comment regarding the complaints: “TikTok has rapidly become a highly popular social media application with millions of European users. However, TikTok is failing to uphold user rights on a substantial scale. We have identified a range of consumer rights infringements and have subsequently filed a complaint against TikTok.”

“Children are enthusiastic users of TikTok, yet the company does not adequately protect them. We aim to prevent our youngest users from being subjected to pervasive, concealed advertising and unknowingly becoming advertising platforms while simply seeking entertainment.”

“Alongside our member organizations – consumer groups throughout Europe – we urge authorities to take prompt action. They must act now to ensure TikTok is a safe environment where consumers, particularly children, can enjoy the platform without having their rights compromised.”

A TikTok spokesperson was contacted for comment on the complaints.

Update: A Commission spokesperson has confirmed receipt of BEUC’s alert.

“Consumer rights must be equally protected, both online and offline. This principle was reaffirmed in the New Consumer Agenda, presented last year,” the spokesperson stated. “The European Commission will carefully evaluate all information provided by BEUC, along with input from national consumer authorities in the coming weeks, to determine if further investigation is warranted.”