The European Commission announced on Thursday that it has formally notified Chinese social media platform TikTok of its preliminary finding that the company has failed to comply with its obligations under the EU's Digital Services Act (DSA), particularly regarding the establishment of a "transparent" advertising repository for ads displayed on its platform.

In a statement, the Commission explained that the absence of this repository "hinders" the ability of researchers and civil society to monitor "fraudulent ads, coordinated disinformation campaigns, and misleading advertisements," especially during electoral processes.

The investigation further revealed that TikTok "does not provide sufficient information" about ad content, targeted demographics, or funding sources. The current system also lacks comprehensive search functionality within the database, significantly limiting its effectiveness.

These findings follow an "in-depth" investigation that included a review of internal company documents, testing of TikTok's tools, and interviews with experts.

TikTok now has the right to submit a written response and defend its position. If the violations are ultimately confirmed, the Commission may issue a formal non-compliance decision, which could result in:

• Fines of up to 6% of the company's global annual revenue

• Enhanced temporary oversight to ensure corrective measures

• Potential daily penalties to compel compliance

Background & Ongoing Scrutiny

The Commission initiated formal proceedings against TikTok in February 2024, examining not only advertising transparency but also concerns over:

• Algorithmic design and its "negative societal impact"

• Minor protection measures

• Data access for researchers

A separate investigation was launched in December 2024 focusing on TikTok’s handling of election-related risks and civic discourse.