TikTok faces penalty over non-transparent ads that harm online users

TikTok, one of the world’s most popular social media platforms, is under scrutiny by EU regulators for allegedly violating key provisions of the Digital Services Act (DSA).

TikTok Lite on smartphone
TikTok Lite on smartphone

This development raises significant concerns for consumers who use the video platform, as the accusations center around TikTok’s failure to provide transparency in advertising practices, potentially exposing users to misleading and harmful content.

According to a news statement from the European Commission, TikTok has not maintained a comprehensive advertisement repository, a critical component required by the DSA to enable researchers and the public to detect scam advertisements, hybrid threat campaigns, and coordinated misinformation operations.

By not providing necessary information about the content of ads, targeted users, and payment sources on its digital platform, TikTok compromises the public’s ability to understand who is influencing them and how, European Commission said.

“Transparency in online advertising — who pays and how audiences are targeted — is essential to safeguarding the public interest. Whether we are defending the integrity of our democratic elections, protecting public health, or protecting consumers from scam ads, citizens have a right to know who is behind the messages they see,” Henna Virkkunen, Executive Vice-President for Tech Sovereignty, Security and Democracy, said.

“In our preliminary view, TikTok is not complying with the DSA in key areas of its advertisement repository, preventing the full inspection of the risks brought about by its advertising and targeting systems,” Henna Virkkunen said.

“While we support the goals of the regulation and continue to improve our ad transparency tools, we disagree with some of the Commission’s interpretations and note that guidance is being delivered via preliminary findings rather than clear, public guidelines,” a TikTok spokesperson said, news report from Reuters indicated.

For consumers, the implications are substantial. The lack of transparency means users might unknowingly engage with advertisements funded by dubious or undisclosed entities, increasing the risk of misinformation and deceptive marketing.

Furthermore, the Commission’s findings suggest that TikTok’s algorithmic systems may also contribute to harmful rabbit hole effects and behavioral addiction, raising ethical questions about how user data is being leveraged to keep people on the platform longer.

The Commission’s ongoing investigation also touches on age assurance, data privacy, and election-related risks — issues that directly impact consumer welfare. For instance, if TikTok fails to provide adequate privacy safeguards, especially for minors, it could expose vulnerable users to exploitation and data misuse.

With the possibility of a fine amounting to 6 percent of TikTok’s global turnover, the stakes are high, and consumers have a vested interest in how this investigation unfolds. Should the Commission’s preliminary findings be confirmed, TikTok may face not only financial penalties but also enhanced regulatory supervision, potentially affecting its operations and content delivery model.

For consumers, this case serves as a reminder of the importance of transparency and accountability in digital platforms, especially as they continue to wield significant influence over public opinion and online behavior.

Baburajan Kizhakedath

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