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Poland faces millions in EU fines as president vetoes tech bill
A clash between Poland’s right-wing president and its centrist ruling coalition over the European Union’s flagship social media law is putting the country further at risk of multimillion euro fines from Brussels. President Karol Nawrocki is holding up a bill that would implement the EU’s Digital Services Act, a tech law that allows regulators to police how social media firms moderate content. Nawrocki, an ally of U.S. President Donald Trump, said in a statement that the law would “give control of content on the internet to officials subordinate to the government, not to independent courts.” The government coalition led by Prime Minister Donald Tusk, Nawrocki’s rival, warned this further exposed them to the risk of EU fines as high as €9.5 million. Deputy Digital Minister Dariusz Standerski said in a TV interview that, “since the president decided to veto this law, I’m assuming he is also willing to have these costs [of a potential fine] charged to the budget of the President’s Office.” Nawrocki’s refusal to sign the bill brings back bad memories of Warsaw’s years-long clash with Brussels over the rule of law, a conflict that began when Nawrocki’s Law and Justice party rose to power in 2015 and started reforming the country’s courts and regulators. The EU imposed €320 million in penalties on Poland from 2021-2023. Warsaw was already in a fight with the Commission over its slow implementation of the tech rulebook since 2024, when the EU executive put Poland on notice for delaying the law’s implementation and for not designating a responsible authority. In May last year Brussels took Warsaw to court over the issue. If the EU imposes new fines over the rollout of digital rules, it would “reignite debates reminiscent of the rule-of-law mechanism and frozen funds disputes,” said Jakub Szymik, founder of Warsaw-based non-profit watchdog group CEE Digital Democracy Watch. Failure to implement the tech law could in the long run even lead to fines and penalties accruing over time, as happened when Warsaw refused to reform its courts during the earlier rule of law crisis. The European Commission said in a statement that it “will not comment on national legislative procedures.” It added that “implementing the [Digital Services Act] into national law is essential to allow users in Poland to benefit from the same DSA rights.” “This is why we have an ongoing infringement procedure against Poland” for its “failure to designate and empower” a responsible authority, the statement said. Under the tech platforms law, countries were supposed to designate a national authority to oversee the rules by February 2024. Poland is the only EU country that hasn’t moved to at least formally agree on which regulator that should be. The European Commission is the chief regulator for a group of very large online platforms, including Elon Musk’s X, Meta’s Facebook and Instagram, Google’s YouTube, Chinese-owned TikTok and Shein and others. But national governments have the power to enforce the law on smaller platforms and certify third parties for dispute resolution, among other things. National laws allow users to exercise their rights to appeal to online platforms and challenge decisions. When blocking the bill last Friday, Nawrocki said a new version could be ready within two months. But that was “very unlikely … given that work on the current version has been ongoing for nearly two years and no concrete alternative has been presented” by the president, said Szymik, the NGO official. The Digital Services Act has become a flashpoint in the political fight between Brussels and Washington over how to police online platforms. The EU imposed its first-ever fine under the law on X in December, prompting the U.S. administration to sanction former EU Commissioner Thierry Breton and four other Europeans. Nawrocki last week likened the law to “the construction of the Ministry of Truth from George Orwell’s novel 1984,” a criticism that echoed claims by Trump and his top MAGA officials that the law censored conservatives and right-wingers. Bartosz Brzeziński contributed reporting.
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Rule of Law
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Polish president aligns with Trump to block Brussels’ Big Tech law
WARSAW — Poland’s nationalist President Karol Nawrocki on Friday sided with his ally U.S. President Donald Trump to veto legislation on enforcing the EU’s social media law, which is hated by the American administration. Trump and his top MAGA officials condemn the EU’s Digital Services Act — which seeks to force big platforms like Elon Musk’s X, Facebook, Instagram to moderate content — as a form of “Orwellian” censorship against conservative and right-wingers. The presidential veto stops national regulators in Warsaw from implementing the DSA and sets Nawrocki up for a a clash with centrist pro-EU Prime Minister Donald Tusk. Tusk’s parliamentary majority passed the legislation introducing the DSA in Poland. Nawrocki argued that while the bill’s stated aim of protecting citizens — particularly minors — was legitimate, the Polish bill would grant excessive power to government officials over online content, resulting in “administrative censorship.”  “I want this to be stated clearly: a situation in which what is allowed on the internet is decided by an official subordinate to the government resembles the construction of the Ministry of Truth from George Orwell’s novel 1984,” Nawrocki said in a statement — echoing the U.S.’s stance on the law. Nawrocki also warned that allowing authorities to decide what constitutes truth or disinformation would erode freedom of expression “step by step.” He called for a revised draft that would protect children while ensuring that disputes over online speech are settled by independent courts. Deputy Prime Minister and Digital Affairs Minister Krzysztof Gawkowski dismissed Nawrocki’s position, accusing the president of undermining online safety and siding with digital platforms.  “The president has vetoed online safety,” Gawkowski told a press briefing Friday afternoon, arguing the law would have protected children from predators, families from disinformation and users from opaque algorithms.  The minister also rejected Nawrocki’s Orwellian comparisons, saying the bill explicitly relied on ordinary courts rather than officials to rule on online content. Gawkowski said Poland is now among the few EU countries without national legislation enabling effective enforcement of the DSA and pledged that the government would continue to pursue new rules. The clash comes as enforcement of the social media law has become a flashpoint in EU-U.S. relations.  Brussels has already fined Elon Musk’s X €120 million for breaching the law, prompting a furious response from Washington, including travel bans imposed by the Trump administration on former EU Commissioner Thierry Breton, an architect of the tech law, and four disinformation experts. The DSA allows fines of up to 6 percent of a company’s global revenue and, as a measure of last resort, temporary bans on platforms. Earlier this week, the European Commission expanded its investigation into X’s AI service Grok after it started posting a wave of non-consensual sexualized pictures of people in response to X users’ requests. The European Commission’s digital spokesperson Thomas Regnier said the EU executive would not comment on national legislative procedures. “Implementing the DSA into national law is essential to allow users in Poland to benefit from the same DSA rights, such as challenging platforms if their content is deleted or their account suspended,” he said. “This is why we have an ongoing infringement procedure against Poland. We have referred Poland to the Court of Justice of the EU for failure to designate and empower the Digital Services Coordinator,” in May 2025, Regnier added. Gawkowski said that the government would make a quick decision on what to do next with the vetoed bill but declined to offer specifics on what a new bill would look like were it to be submitted to parliament again. Tusk four-party coalition does not have enough votes in parliament to override Nawrocki’s vetoes. That has created a political deadlock over key legislation efforts by the government, which stands for reelection next year. Nawrocki, meanwhile, is aiming to help the Law and Justice (PiS) political party he’s aligned with to retake power after losing to Tusk in 2023. Mathieu Pollet contributed reporting.
Customs
Services
Technology
Data
Data protection
Trump administration fires warning shots over Big Tech regulations
The Trump administration is lashing out at foreign laws aimed at clamping down on online platforms that have gained outsized influence on people’s attention — while trying to avoid launching new trade wars that could threaten the U.S. economy. Over the past month, U.S. officials have paused talks on a tech pact with the United Kingdom, canceled a trade meeting with South Korean officials and issued veiled threats at European companies over policies they believe unfairly penalize U.S. tech giants. Several tech policy professionals and people close to the White House say the recent actions amount to a “negotiating tactic,” in the words of one former U.S. trade official. As talks continue with London, Brussels and Seoul, the Office of the U.S. Trade Representative is pressing partners to roll back digital taxes on large online platforms and rules aimed at boosting online privacy protections — measures U.S. officials argue disproportionately target America’s tech behemoths. “It’s telegraphing that we’ve looked at this deeply, we think there’s a problem, we’re looking at tools to address it and we’re looking at remedies if we don’t come to an agreement,” said Everett Eissenstat, who served as the director of the National Economic Council in Trump’s first term. “It’s not an unprecedented move, but naming companies like that and telegraphing that we have targets, we have tools, is definitely meaningful.” But so far, the administration has shied away from new tariffs or other aggressive actions that could upend tentative trade agreements or upset financial markets. And the new tough talk may not be enough to placate some American tech companies, who are pressing for action. One possible action, floated by U.S. Trade Representative Jamieson Greer, would be launching investigations into unfair digital trade practices, which would allow the administration to take action against countries that impose digital regulations on U.S. companies. “I would just say that’s the next level of escalation. I think that’s what people are waiting for and looking for,” said a representative from a major tech company, granted anonymity to speak candidly and discuss industry expectations. “What folks are looking for is like action over the tweets, which, we love the tweets. Everyone loves the tweets.” Trump used similar investigations to justify raising tariffs on hundreds of Chinese imports in his first term. But those investigations take time, and it can be years before any increases would go into effect. Greer has also been careful to hedge threats of new trade probes, stressing they are not meant to spiral into a broader conflict. Speaking on CNBC’s “Squawk Box” last week, he floated launching a trade investigation into the EU’s digital policies, but said the goal would be a “negotiated outcome,” not an automatic path to higher tariffs. “I don’t think we’re in a world where we want to have some renewed trade fight or something with the EU — that’s not what we’re talking about,” Greer said. “We want to finish off our deal and implement it,” he continued, referring to the trade pact the partners struck over the summer. Greer also raised the prospect of a trade probe in private talks with South Korea earlier this fall, saying the U.S. might have to resort to such action if the country continues to pursue legislation the administration views as harmful to U.S. tech firms. But a White House official clarified that the U.S. was not yet considering such a “heavy-handed approach.” Even industry officials aren’t certain how aggressive they want the Trump administration to be, acknowledging that if the U.S. escalated its fight with the EU over their tech regulations, it could spark a digital trade war that would ultimately end up harming all of the companies involved, according to a former USTR official, granted anonymity to speak candidly. President Donald Trump has long criticized the tech regulations — pioneered by the European Union and now proliferating around the globe. But he’s made the issue a much more central part of his second-term trade agenda, with mixed results. While Trump’s threat to cut off trade talks with Canada got Prime Minister Mark Carney to rescind their three percent tax on revenue earned by large online platforms, his administration has struggled to make headway with the EU, UK and South Korea in the broader trade negotiations over tariffs. The tentative trade deal the administration reached with the EU over the summer included a commitment from the bloc to address “unjustified digital trade barriers” and a pledge not to impose network usage fees, but left the scope and direction of future discussions largely undefined. The agreement fleshed out with South Korea this fall appeared to go even further, spelling out commitments that regulations governing online platforms and cross-border data flows won’t disadvantage American companies. But none of those governments have so far caved to U.S. pressure to abandon their digital regulations entirely, and the canceled talks and threatening social media posts are a sign of Trump’s growing frustration. “You won’t be surprised to know that what we think is fair treatment and what they think is fair treatment is quite different and I’ve been quite frankly disappointed over the past few months to see zero moderation by the EU,” Greer said Dec. 10 at an event at the Atlantic Council. Last week, Greer’s office amped up the rhetoric further, threatening to take action against major European companies like Spotify, German automation company Siemens and Mistral AI, the French artificial intelligence firm, if the EU doesn’t back off enforcement of its digital rules. The threat came a week after the EU fined X, the company formerly known as Twitter, $140 million for failing to meet EU transparency rules. Greer’s office also canceled a meeting planned for last Thursday with South Korean officials, as South Korean lawmakers introduced new digital legislation and held an explosive hearing on a data breach at Coupang, an American-headquartered e-commerce company whose largest market is in South Korea. The South Korean Embassy denied any relationship between the Coupang hearing and the cancellation of the recent meeting. “Neither Coupang’s data breach, the subsequent investigation by the Korean government, nor the National Assembly’s hearing played a role in the scheduling of the KORUS Joint Committee,” said an embassy official. The canceled meetings and frozen talks are significant — delaying implementation of bare bones trade agreements and investment pledges inked in recent months. But the Trump administration has shown little interest in blowing up the deals its reached and reapplying the steep tariffs it threatened over the summer, which could trigger significant retaliation and, as concerns about affordability and inflation continue to simmer in the U.S., prove politically dicey. Launching trade investigations at USTR or fining specific foreign companies could be a less inflammatory move. “What is happening is that these issues are starting to come to a head,” said Dirk Auer, a Director of Competition Policy International Center for Law & Economics, who focuses on antitrust issues and recently testified before Congress on digital services laws. “At some point the administration has to put up or shut up. They need to put their money where their mouth is. And I think that’s what’s happening right now.” Gabby Miller contributed to this report.
Privacy
UK
Conflict
Intelligence
Media
EU investigates China’s Nuctech, Temu for unfair foreign subsidies
BRUSSELS — The European Commission is cracking down on two Chinese companies, airport scanner maker Nuctech and e-commerce giant Temu, that are suspected of unfairly penetrating the EU market with the help of state subsidies. The EU executive opened an in-depth probe into Nuctech under its Foreign Subsidies Regulation on Thursday, a year and a half after initial inspections at the company’s premises in Poland and the Netherlands. “The Commission has preliminary concerns that Nuctech may have been granted foreign subsidies that could distort the EU internal market,” the EU executive said in a press release.  Nuctech is a provider of threat detection systems including security and inspection scanners for airports, ports, or customs points in railways or roads located at borders, as well as the provision of related services.  EU officials worry that Nuctech may have received unfair support from China in tender contracts, prices and conditions that can’t be reasonably matched by other market players in the EU.  “We want a level playing field on the market for such [threat detection] systems, keeping fair opportunities for competitors, customers such as border authorities,” Executive Vice President Teresa Ribera said in a statement, noting that this is the first in-depth investigation launched by the Commission on its own initiative under the FSR regime.  Nuctech may need to offer commitments to address the Commission’s concerns at the end of the in-depth probe, which can also end in “redressive measures” or with a non-objection decision.   The FSR is aimed at making sure that companies operating in the EU market do so without receiving unfair support from foreign governments. In its first two years of enforcement, it has come under criticism for being cumbersome on companies and not delivering fast results.  In a statement, Nuctech acknowledged the Commission’s decision to open an in-depth investigation. “We respect the Commission’s role in ensuring fair and transparent market conditions within the European Union,” the company said. It said it would cooperate with the investigation: “We trust in the integrity and impartiality of the process and hope our actions will be evaluated on their merits.” TEMU RAIDED In a separate FSR probe, the Commission also made an unannounced inspection of Chinese e-commerce platform Temu.  “We can confirm that the Commission has carried out an unannounced inspection at the premises of a company active in the e-commerce sector in the EU, under the Foreign Subsidies Regulation,” an EU executive spokesperson said in an emailed statement on Thursday.   Temu’s Europe headquarters in Ireland were dawn-raided last week, a person familiar with Chinese business told POLITICO. Mlex first reported on the raids on Wednesday.  The platform has faced increased scrutiny in Brussels and across the EU. Most recently, it was accused of breaching the EU’s Digital Services Act by selling unsafe products, such as toys. The platform has also faced scrutiny around how it protects minors and uses age verification.  Temu did not respond to a request for comment.
Airports
Borders
Ports
Services
Mobility
Digital euro: A good idea, but please get it right!
The discussion surrounding the digital euro is strategically important to Europe. On Dec. 12, the EU finance ministers are aiming to agree on a general approach regarding the dossier. This sets out the European Council’s official position and thus represents a major political milestone for the European Council ahead of the trilogue negotiations. We want to be sure that, in this process, the project will be subject to critical analysis that is objective and nuanced and takes account of the long-term interests of Europe and its people. > We do not want the debate to fundamentally call the digital euro into question > but rather to refine the specific details in such a way that opportunities can > be seized. We regard the following points as particularly important: * maintaining European sovereignty at the customer interface; * avoiding a parallel infrastructure that inhibits innovation; and * safeguarding the stability of the financial markets by imposing clear holding limits. We do not want the debate to fundamentally call the digital euro into question but rather to refine the specific details in such a way that opportunities can be seized and, at the same time, risks can be avoided. Opportunities of the digital euro:  1. European resilience and sovereignty in payments processing: as a public-sector means of payment that is accepted across Europe, the digital euro can reduce reliance on non-European card systems and big-tech wallets, provided that a firmly European design is adopted and it is embedded in the existing structures of banks and savings banks and can thus be directly linked to customers’ existing accounts. 2. Supplement to cash and private-sector digital payments: as a central bank digital currency, the digital euro can offer an additional, state-backed payment option, especially when it is held in a digital wallet and can also be used for e-commerce use cases (a compromise proposed by the European Parliament’s main rapporteur for the digital euro, Fernando Navarrete). This would further strengthen people’s freedom of choice in the payment sphere. 3. Catalyst for innovation in the European market: if integrated into banking apps and designed in accordance with the compromises proposed by Navarrete (see point 2), the digital euro can promote innovation in retail payments, support new European payment ecosystems, and simplify cross-border payments. > The burden of investment and the risk resulting from introducing the digital > euro will be disproportionately borne by banks and savings banks. Risks of the current configuration: 1. Risk of creating a gateway for US providers: in the configuration currently planned, the digital euro provides US and other non-European tech and payment companies with access to the customer interface, customer data and payment infrastructure without any of the regulatory obligations and costs that only European providers face. This goes against the objective of digital sovereignty. 2. State parallel infrastructures weaken the market and innovation: the European Central Bank (ECB) is planning not just two new sets of infrastructure but also its own product for end customers (through an app). An administrative body has neither the market experience nor the customer access that banks and payment providers do. At the same time, the ECB is removing the tried-and-tested allocation of roles between the central bank and private sector. Furthermore, the Eurosystem’s digital euro project will tie up urgently required development capacity for many years and thereby further exacerbate Europe’s competitive disadvantage. The burden of investment and the risk resulting from introducing the digital euro will be disproportionately borne by banks and savings banks. In any case, the banks and savings banks have already developed a European market solution, Wero, which is currently coming onto the market. The digital euro needs to strengthen rather than weaken this European-led payment method. 3. Risks for financial stability and lending: without clear holding limits, there is a risk of uncontrolled transfers of deposits from banks and savings banks into holdings of digital euros. Deposits are the backbone of lending; large-scale outflows would weaken both the funding of the real economy – especially small and medium-sized enterprises – and the stability of the system. Holding limits must therefore be based on usual payment needs and be subject to binding regulations. -------------------------------------------------------------------------------- Disclaimer POLITICAL ADVERTISEMENT * The sponsor is Bundesverband der Deutschen Volksbanken und Raiffeisenbanken e.V. , Schellingstraße 4, 10785 Berlin, Germany * The ultimate controlling entity is Bundesverband der Deutschen Volksbanken und Raiffeisenbanken e.V. , Schellingstraße 4, 10785 Berlin, Germany More information here.
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Negotiations
Data
Pornography, children and privacy: Europe’s digital dilemma
Listen on * Spotify * Apple Music * Amazon Music Europe faces a growing dilemma: how to protect children online without breaking digital privacy for everyone.  A new report from the Internet Watch Foundation found that 62 percent of all child sexual abuse material discovered online last year was hosted on EU servers. It’s a shocking statistic that has left Brussels locked in a heated debate over how far new regulations should go — and whether scanning encrypted messages could be justified, even at the cost of privacy and the risk of mass surveillance.  Host Sarah Wheaton is joined by POLITICO’s Sam Clark, Eliza Gkritsi and Océane Herrero to unpack Europe’s child safety regulations — and the balance between protecting kids, protecting privacy and policing platforms. The conversation also touches on the latest controversy out of France, involving Shein — the fast-fashion giant caught selling childlike sex dolls online.   Then, from Europe’s digital dilemmas to Albania’s digital experiment: Gordon Repinski, host of POLITICO’s Berlin Playbook podcast, sits down with Albanian Prime Minister Edi Rama, who has appointed the world’s first artificial intelligence minister — a virtual woman named Diella. Rama explains why he believes Diella could help fight corruption, cut bureaucracy and speed up Albania’s path toward EU membership. 
Privacy
Politics
Artificial Intelligence
Foreign Affairs
Safety
Shein’s childlike sex dolls trigger ban threat from French minister
PARIS — Economy Minister Roland Lescure warned Monday he could stop Shein from selling its products of France after a consumer watchdog report accused the Chinese-founded fast-fashion platform of selling “sex dolls with childlike appearances.” “For terrorist acts, drug trafficking and child pornography, the government has the right to request banning access to the French market,” Lescure said. “These horrible items are illegal.” Over the weekend, France’s Directorate-General for Competition, Consumer Affairs and Fraud Control (DGCCRF) issued a statement alleging that it had “found that the e-commerce site SHEIN was selling child-like sex dolls.” “Their description and categorization on the site leave little doubt as to the child pornographic nature of the content,” the statement added. Shein did not immediately respond to POLITICO’s request for comment. Lescure said that he had filed a legal report on this matter and asked France’s digital regulator Arcom, which is responsible for regulating “very large” platforms like Shein under the European Digital Services Act, to look into the matter. France’s High Commissioner for Youth, Sarah El-Haïry, said Sunday that she would convene “all major platforms” to understand how such products are put on the market. In 2021, then-Economy Minister Bruno Le Maire order popular search engines and mobile app stores to delist another online marketplace, Wish, after several reports from the DGCCRF. Wish was reauthorized a year later. This article was first published by POLITICO in French and translated by Victor Goury-Laffont.
Services
Technology
Markets
Platforms
digital
Poupées sexuelles d’enfants : Roland Lescure envisage d’interdire Shein si les manquements sont “répétés”
PARIS — Le ministre de l’Economie a menacé Shein d’interdiction en France si l’enquête judiciaire montrait que les comportements de la plateforme de fast-fashion sont “répétés”. Roland Lescure était interrogé ce matin sur BFM TV après que la direction générale de la Concurrence, de la Consommation et de la Répression des fraudes (DGCCRF) a découvert, vendredi 31 octobre, que la plateforme proposait à la vente des poupées sexuelles à l’effigie d’enfants. L’administration avait alors immédiatement saisi le procureur de la République et l’Arcom. “Pour des actes terroristes, pour le trafic de stupéfiants et pour des objets pédopornographiques, le gouvernement est en droit de demander l’interdiction de l’accès au marché français”, a ajouté le ministre de l’Economie. “Ces objets horribles sont illégaux”, a rappelé Roland Lescure, ajoutant avoir saisi la justice et l’Arcom, qui est compétente en la matière puisque Shein a été désignée l’an passée comme très grande plateforme en ligne (VLOP) dans le cadre du règlement européen sur les services numériques (DSA). La haut-commissaire à l’Enfance, Sarah El-Haïry, a pour sa part annoncé dimanche son intention de convoquer “l’ensemble des grandes plateformes” pour comprendre le circuit de commercialisation de ces produits. En 2021, le site de vente en ligne Wish avait fait l’objet de mesures de déréférencement à la demande de Bruno Le Maire, alors ministre de l’Economie. Après plusieurs enquêtes de la DGCCRF sur la sécurité des produits proposés par la plateforme, les principaux gestionnaires de moteurs de recherche et les magasins d’applications mobiles avaient été appelés à dérérencer Wish, avant que le site ne soit finalement à nouveau autorisé un an plus tard. Contacté par POLITICO, Shein n’a pas donné suite au moment de la publication.
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Paris Influence
Tech France
e-commerce
Protection des mineurs en ligne
French consumer watchdog reports Shein over childlike sex doll
PARIS — France’s consumer protection agency has reported Chinese-founded online fast-fashion platform Shein over the sale of childlike sex dolls. “The French Directorate-General for Competition, Consumer Affairs, and Fraud Control (DGCCRF) found that the e-commerce site Shein was selling sex dolls with childlike appearances,” the agency said Saturday evening, adding that it had “referred the matter to the public prosecutor.” Shein is accused in France and beyond of selling goods that do not comply with EU laws. In July, the DGCCRF fined the company €40 million for misleading consumers about prices. Back in May, the European Commission and consumer protection authorities had also notified the platform of alleged violations of consumer protection law, including fake discounts and misleading sustainability claims. EU Justice Commissioner Michael McGrath later said he was determined to crack down on the sale of goods on Temu and Shein that do not comply with EU regulations. “As a reminder, the distribution of child pornography via an electronic communications network is punishable by up to seven years’ imprisonment and a fine of €100,000,” the French DGCCRF said in Saturday’s statement. The agency also reached out to the French platform regulator Arcom, which is responsible for regulating companies such as Shein. The platform was ordered to take appropriate measures swiftly. Shein told Agence France-Presse the items have been removed from the platform and an investigation was launched to find out how the sellers managed to circumvent the control processes. The DGCCRF also reported to the prosecutor and Arcom that pornographic content such as adult-looking sex dolls is available without filtering measures to restrict access to minors, which is also against French law. Shein is especially controversial in France: The most recent incident is the platform’s arrival at the flagship department store BHV in Paris, which sparked outrage among suppliers.
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Technology
Communications
Companies
Sustainability
Meta, TikTok dent Europe’s social media regime with court win over tech levy
Meta and TikTok have dealt a blow to the European Commission’s social media rule book, pressing the EU executive to codify how it calculates the number of users on online platforms. The General Court at the Court of Justice of the European Union sided with the social media companies on Wednesday in their challenge of an annual supervisory fee the European Union charges to pay for the enforcement of its tech rulebook, the Digital Services Act (DSA). It’s the first major court loss for the Commission over the DSA, which entered into force in 2022 and can be wielded to fine social media and e-commerce platforms up to 6 percent of their global annual revenue. The EU has yet to finalize investigations under the law. At the heart of the case are platforms’ disagreements with how the EU calculated the fee. The Commission directly supervises “very large online platforms” with over 45 million average monthly users in the bloc. Meta and TikTok challenged the European Commission’s decisions imposing so-called supervisory fees in 2024. These fees are meant to support the Commission’s work overseeing the very platforms that pay it — an extension of the “polluter pays” principle often used in environmental policy — and are proportionate to the number of users platforms have in the EU. The EU’s General Court said in its ruling the Commission should have passed a separate set of rules about how users are calculated before determining the fees. Judges gave the Commission a year to draft a text on how it calculates platform users, or else potentially refund the platforms’ 2023 fees. The EU executive has already been working on such rules, called a delegated act. The Commission said the court merely ruled against it on procedure and not substance. “The Court confirms our methodology is sound: no error in calculation, no suspension of any payments, no problem with the principle of the fee nor the amount,” said spokesperson Thomas Regnier. Meta said in a statement that the judgement “will force the European Commission to reassess the unfair methodology being used to calculate these DSA fees,” adding it “looks forward to the flaws in the methodology being addressed.” TikTok “welcomed” the decision and will “closely follow the development” of the case, company spokesperson Paolo Ganino said.
Customs
Services
Social Media
Technology
Data