The European Union on Monday open against ByteDance's TikTok and threatened to suspend the newly launched TikTok Lite rewards program, which allows users to earn points for liking content or inviting friends to the app.
The European Commission, the EU's executive arm, said TikTok has 24 hours to submit a risk assessment report for TikTok Lite or face fines. The social media app was given until May 3 to offer additional requested information.
The commission said it was concerned that TikTok Lite's “tasks and rewards program” was launched “without prior careful assessment of the risks involved, in particular those related to the addictive nature of the platforms.”
Children are believed to be in danger because TikTok is believed to lack effective age verification mechanisms, the EU said.
A TikTok spokesperson told CNBC that the corporate was “disappointed” by the choice.
“TikTok Lite's rewards hub is not available to those under 18 and there is a daily limit on video watching tasks. We will continue discussions with the Commission,” they added.
The investigation represents the second formal investigation that the EU has launched against the social media company. In February the EU announced It investigated whether TikTok violated rules on parental protection, promoting transparency and risk management of addictive design and harmful content.
“Under the Digital Services Act, online platforms have a responsibility to assess and address any potential risks their users may be exposed to,” EU antitrust chief Margrethe Vestager said in an announcement.
“Therefore, the Commission has opened a compliance procedure requiring TikTok to provide an assessment and further information on how it protects its users from potential risks on its platform,” it added.
What is TikTok Lite?
TikTok Lite, launched in France and Spain this month, is a brand new app with functionality geared toward users aged 18 and over.
The app's rewards program allows users to earn points while completing certain tasks, akin to watching videos or following creators. These points can then be exchanged for rewards akin to gift cards or Amazon vouchers.
Under the terms of the EU's comprehensive Digital Services Act, corporations with a median of greater than 45 million energetic users within the bloc are considered very large online platforms and must adhere to strict rules to combat illegal and harmful content on their platforms.
“Endless streams of short and fast-paced videos might be seen as fun, but they also put our children at risk of addiction, anxiety, depression, eating disorders and low attention spans,” EU industry chief Thierry Breton said in an announcement.
“With our initial DSA violation case against TikTok ongoing, the company has launched TikTok Lite, which financially rewards additional screen time. We suspect that TikTok ‘Lite’ could be as toxic and addictive as ‘Light’ cigarettes,” said Breton.
“Unless TikTok provides convincing evidence of its safety, which it has failed to do so far, we stand ready to take DSA interim measures, including suspending the TikTok Lite feature, which we suspect could be addictive.”
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