TikTok responds to EU ultimatum over new rewards-for-views scheme

A European Commission spokesman confirmed on Tuesday that it had received a reply from TikTok to an order to provide within 24 hours an assessment of mental health risks related to its new app, TikTok Lite.
Monday's legally-binding order concerns the new app's rewards scheme, which allows users to collect points by watching videos and exchange them for things of value, such as Amazon vouchers, according to commission officials.
The commission wants to know how the Chinese-owned video-sharing platform assessed the addictiveness and mental health risks of the scheme, particularly for children, prior to launch. The EU's Digital Services Act (DSA) requires large platforms to assess and mitigate such risks.
"We can confirm that we received a reply from TikTok," a commission spokesman told dpa. He said the EU executive will now "assess the response and decide on potential next steps."
If the commission decides that TikTok hasn't provided the information it asked for, it could fine the company 1% of its global annual revenue, plus periodic fines of 5% of its daily revenue.
The commission initially requested the information on April 17, with a non-binding deadline the following day.
Commission officials said TikTok responded to that request by telling them it had carried out a risk assessment, but that it could not share the document. The commission then followed-up with a binding order on Monday.
A TikTok spokeswoman told dpa that this was because the company had asked the commission for more time. In a statement, the company said TikTok Lite's rewards scheme is not available to minors, and has a daily limit on the number of videos that can be watched for a reward.
"We are disappointed with this decision - the TikTok Lite rewards hub is not available to under 18s, and there is a daily limit on video watch tasks. We will continue discussions with the commission," the statement said.
TikTok Lite had its European launch in France and Spain this month.
On Monday, the commission also gave TikTok 48 hours to show that it has complied with the DSA and that there is no risk of serious harm from the rewards features, after which the EU executive could order the platform to suspend the feature allowing points to be exchanged, pending further investigation.
A commission press release on Monday said the EU executive "is concerned that the 'Task and Reward Program' of TikTok Lite, which allows users to earn points while performing certain 'tasks' on TikTok - such as watching videos, liking content, following creators, inviting friends to join TikTok, etc - has been launched without prior diligent assessment of the risks it entails, in particular those related to the addictive effect of the platforms, and without taking effective risk mitigating measures."
If the commission ultimately concludes that TikTok has fallen short of its risk-assessment and risk-mitigation obligations under the DSA, it could fine the company 6% of its global annual revenue.
The DSA's risk-mitigation rules for Very Large Online Platforms (VLOPs) - those with more than 45 million monthly active users in the European Union - came into force in August 2023.
Currently-listed VLOPs include TikTok, X - formerly known as Twitter - and Meta's Facebook and Instagram platforms.