Chinese social media giant Bytedance was dealt a blow last September when it was fined a record $370 million by Ireland’s data privacy watchdog for failing to adequately safeguard the personal data of children using its TikTok app . New corporate documents suggest Bytedance expects more such fines. The company has explicitly set aside $1 billion to cover future fines from European privacy regulators.
Bytedance has faced a barrage of lawsuits and investigations from regulators around the world over TikTok’s addictive design, handling of user data, and lack of safeguards for teenage users. Just yesterday, attorneys general from thirteen states and the District of Columbia filed separate lawsuits alleging that TikTok was designed to be used compulsively and had harmed children and teens as a result.
The $1 billion provision for future fines was revealed in corporate accounts for TikTok’s European operations filed this week with the UK’s Companies House. The accounts also show that TikTok’s revenue in Europe rose to $4.57 billion last year, up from $2.6 billion in 2022. Its losses have also nearly tripled to $1.3 billion in 2023, up from $512 million.
“The interpretation of the General Data Protection Regulation is still evolving and draft decisions in investigations by data protection supervisory authorities are subject to review,” creating uncertainty about the fines that could be imposed, Bytedance said in the corporate filing.
The scale of the total fines and penalties TikTok faces on the continent could be even larger than the $1 billion provision in its 2023 accounts. The European Commission opened an investigation into TikTok under the Digital Services Act (DSA) in February 2024. The EU can fine companies up to 6% of global revenue for breaching the DSA, or impose a ban.
The $1 billion settlement includes the $370 million fine, the largest the company has faced to date, imposed by Ireland’s Data Protection Commission in September 2023 over its handling of sensitive data of its teenage and underage users. TikTok has appealed the fine and a final penalty has not yet been decided, but the short-form video app has faced a series of regulatory sanctions in recent years. In March, Italy’s competition watchdog ordered TikTok to pay $11 million for lax content monitoring. Last year, it faced a $16 million fine from Britain’s data privacy regulator over its handling of children’s personal information, and a $1 million fine in the Netherlands and $5.7 million in the United States in 2019 for similar reasons.
TikTok noted on its accounts that it also faces $11.4 billion in claims from a trio of Dutch privacy and consumer rights foundations. A Dutch court ruled the claims inadmissible last September, but the case has since been elevated to the Dutch Court of Appeal. TikTok also faces a $1.1 billion legal claim for illegal data collection from a Portuguese consumer rights group.
«These cases are still in the procedural phase and, given the lack of legal precedent, it is impracticable for the group to estimate the potential financial impact of any such claim, and no provision has been made,» TikTok said in its corporate filing.
In the US, TikTok is now facing a massive wave of litigation from a bipartisan group of state attorneys general who allege it pushed design features to encourage compulsive use of its app at the expense of American teens’ mental health. Bytedance is also fighting in court against a federal law passed in April that would require it to sell TikTok to a non-Chinese company by January 2025 or face a US ban . A ruling was expected on December 6, and the case is likely to be appealed to the Supreme Court.
