Three Dutch foundations that want to file a lawsuit against TikTok have been given the green light to do so. Altogether, they claim some 9.4 billion euros from the Chinese social network for allegedly violating the privacy of Dutch users. This means that the substantive hearing can begin.
That is what the Amsterdam court ruled today, the Financieel Dagblad ( 1) writes.
TikTok is a social network where users can post short videos. The platform has grown like crazy in recent years. According to the latest estimates, TikTok has about one billion users worldwide. Our country has about three million active TikTok users. Thanks to advertising revenue, annual sales will reach about 10 billion dollars this year.
At the same time, TikTok has long been under fire for alleged privacy violations. In our country, there are three foundations that want to see money from the company for that reason. Stichting Onderzoek Marktinformatie (SOMI) filed a claim for damages against the social network in June 2021. The foundation is demanding €1.4 billion in damages for violating European privacy and consumer laws. Furthermore, SOMI believes that TikTok does not comply with transparency obligations under the AVG.
Lawyer Douwe Linders called TikTok a profiling and advertising machine. "SOMI has a strong case and we will fight for the interests of its supporters. But a giant like TikTok will not give in easily. We have to be long-winded and careful," said the lawyer who says he represents more than 64,000 parents across Europe.
Together with the Consumers Union, the Foundation Take Back Your Privacy took TikTok to court last August. "TikTok has scandalously abused sometimes very young children. It has misled them, violated their privacy and made gross profits on their backs. Pure exploitation, which must be compensated. And in a way that also acts as a deterrent to other companies doing the same," said Sandra Molenaar, director of the Consumers' Association. The organizations are demanding a total of over 2 billion euros in damages.
Then there is the Mass Tort & Consumer Foundation. It believes that TikTok collects too much information from users for the purpose of creating user profiles. In this way, the platform wants to present personalized advertisements. The foundation believes that TikTok violates all kinds of national and international laws and regulations in doing so. For example, the company is not open and honest about what data it collects and for what purposes. The foundation therefore demands compensation of 6 billion euros.
TikTok tried to nip the lawsuits in the bud. According to the platform, the Dutch court is not authorized to rule on the foundations' claims. Because Twitter is headquartered in Ireland, the Irish court would have to pass judgment. Furthermore, TikTok wants to await an investigation by the Irish regulator, the Data Protection Commission (DPC). Finally, TikTok wants to seek an opinion from the Court of Justice of the European Union.
The Amsterdam court swept aside all of TikTok's arguments. That means the lawsuit can start soon. In December, the judge will determine which foundation will be allowed to take the lead. The substantive hearing is scheduled for February 2023.
The Irish regulator is not the only body to have launched an investigation into TikTok. Last July, the Personal Data Authority imposed a €750,000 fine on the social network. The regulator found that privacy terms were only offered to Dutch children in English. That violates Article 12 of the AVG. That states that the data controller shall communicate in a "concise, transparent, understandable and easily accessible form and in clear and simple language." "In particular when the information is specifically intended for a child," the AVG says.
"This young target group brings an extra responsibility where the use of clear and simple language in all communication is concerned. After all, children deserve specific protection, which makes the use of clear and simple language extra important," the Personal Data Authority wrote in the fine decision.
The Information Commissioner's Office (ICO) concluded last September that TikTok violated British privacy laws for years. Between May 2018 and July 2020, the video platform processed personal data of children under the age of 13 without parental consent. Furthermore, the company gathered special personal data such as ethnicity, religious beliefs and sexual orientation without a legal basis. Finally, communication about what the company would do with the data left much to be desired.
Because of these violations, TikTok risks a £27 million fine.
TikTok has also come under fire outside of Europe. In July of this year, Shou Zi Chew, the CEO of TikTok, confirmed to a Senate committee in the United States that some Chinese employees of parent company ByteDance have access to data of American users. According to the chief executive, the information is limited, such as public videos and reactions to them. Only Chinese TikTok employees who follow "a number of internal security protocols" are allowed to access this data. American users need not fear that this will put personal data in the hands of the Chinese government or military.
Several members of the US Senate Intelligence Committee argued that their fears about TikTok's influence in the US were justified. In their own words, the video platform "poses a threat to national security." In a public letter, they called on the Federal Trade Commission (FTC) to investigate the platform's data collection and data security practices.
There are also serious concerns in our country. Last week, TikTok announced a new privacy policy. Among other things, it stated that starting in December, the social network will access data from Dutch users and share this information with China.
Coalition and opposition parties in the Lower House then submitted a series of written questions to Minister of Economic Affairs and Climate Micky Adriaansens and State Secretary of Digitalization Alexandra van Huffelen. Among other things, they want to know whether the ministers consider it desirable for the Chinese government to have access to this information, and what the cabinet is going to do to put a stop to this.
https://fd.nl/tech-en-innovatie/1457332/tiktok-lijdt-eerste-nederlaag-in-nederlandse-miljardenclaimzaak
