ByteDance submits overdue risk assessment for TikTok Lite amid regulatory pressure

Concerns over the addictive nature of TikTok Lite’s rewards system prompted EU regulators to threaten fines and potential bans.

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ByteDance, the company behind TikTok, has submitted a long-awaited risk assessment for its TikTok Lite service, recently launched in France and Spain, following regulatory threats of fines and potential bans from the European Commission. Regulators are concerned about the addictive nature of TikTok Lite, particularly its rewards system for users, and claim ByteDance didn’t complete a full risk assessment on time.

ByteDance now has until 24 April to defend itself against regulatory action, including possibly suspending the rewards program. Failure to comply with regulations could result in fines of up to 1% of its total annual income or periodic penalties of up to 5% of its average daily income under the Digital Services Act (DSA).

The DSA imposes strict rules on online platforms with over 45 million users in the EU, including other major tech companies like Google, Facebook, Instagram, and LinkedIn.

Why does it matter?

Meanwhile, in the US, legislation is swiftly advancing through Congress, requiring ByteDance, the Chinese company that owns TikTok, to divest its ownership within a year or face a US ban. The Senate has passed this measure as part of a foreign aid package, sending it to President Joe Biden for his expected approval. ByteDance will have nine months initially, with a possible three-month extension, to complete the sale, though legal challenges could cause delays.