By Marc Barennes,[1] Jérémie Jourdan[2] and Maria Gravvani[3]
Introduction
The Digital Services Act (“DSA”)[4] regulates online intermediaries and platforms such as marketplaces, social networks, content-sharing platforms, app stores, and online travel and accommodation platforms which are offered to users (aka ‘recipients of the service’[5]) located in the European Union.[6] Its main goal is to prevent illegal and harmful activities online and the spread of disinformation.[7]
One key innovation of the DSA is to have introduced a 2-tiered system under which very large online platforms (“VLOPs”) or very large online search engines (“VLOSEs”)[8] are regulated by the European Commission (“EC”) and subject to specific obligations which, in essence, aim at mitigating the systemic risks that such large services pose to Europeans and society.[9] Smaller platforms are regulated by national Digital Services Coordinators (DSCs) and subject to lighter obligations.
As of today, 25 services have been designated as VLOPs or VLOSEs.[10] They include social media platforms, large search engines, video sharing platforms, adult sites, and e-commerce sites. They are subject to an annual supervisory fee,[11] which the EC imposed for the first time in decisions adopted in September 2023.
The designations and the imposition of the supervisory fees gave rise to challenges before the General Court (GC) in Luxembourg, and its first judgments were handed in the past days, respectively on appeal from Zalando (designation) and Meta and TikTok (supervisory fees).
On 3 September 2025, the GC handed down its ruling in Zalando v Commission (Case T-348/23).[12] It fully upheld the Zalando’s designation as VLOP. Most importantly, the judgment includes clarifications on the definition of important concepts such as intermediary service provider and on the counting of AMAR, especially for hybrid platforms mixing their own content and third-party content.
One week later, on 10 September 2025, the GC stroke down the decisions addressed to Meta and TikTok imposing a supervisory fee (Cases T-55/24[13] and T-58/24[14]). In essence, the GC found that the decisions lacked legal basis in so far as the methodology for calculating the Average Monthly Active Recipients (“AMAR”), a key component in calculation of the supervisory fee, was erroneously set out in the EC decisions and not in the dedicated delegated act. The effects of these decisions were however maintained for a period of 12 months to allow the EC to correct its error.
In this blog, we discuss the main findings and key takeaways of these three cases.
II. Zalando vs Commission: the GC confirms Zalando’s designation as VLOP
II.1 Background to the dispute
The online shop Zalando sells fashion and beauty products, offering both its own products and those of third parties enrolled in its “Partner Programm”. In line with its obligation under Article 24 DSA,[15] Zalando reported AMAR of 83.3 million in total, covering both Zalando Retail and the Partner Programm, but it also stated that, since the Partner Programm accounted for 37% of the platform’s total sales, its AMAR for the purpose of the DSA should be 30.836 million (i.e. below the VLOP designation threshold).
In the designation decision, the EC took the view that “active recipients” refer to all users who actually interact with the platform, including those merely exposed to information, not just those completing transactions.[16] Since Zalando’s own products and those of third-party sellers are displayed together and are often indistinguishable until purchase, the EC considered that it was impossible to separate users who only viewed Zalando’s products from those who saw third-party products.[17] The EC thus rejected Zalando’s claim that its AMAR was 30.836 million.
Zalando appealed the EC’s decision and argued firstly that its qualification as intermediary service provider and the AMAR calculation were contrary to the DSA. It also argued that Article 33 DSA, on which the decision was based, was unlawful. Finally, it considered that the EC failed to provide adequate reasons to support its decision.
II.2 The GC’s Ruling in the Zalando Case
The GC found that Zalando is an intermediary service provider (“ISP”)
In its first ground of appeal, Zalando argued that, because it sells its own products (and thus is not an intermediary for these sales) and because it curates, to some extent, the third party content that is posted via its Partner Programm, it does not qualify as an ISP within the meaning of the case law. Zalando relied i.a. on the Grand Chamber judgment of the Court of Justice in L’Oréal (C-324/09), concerning the e-commerce directive,[18] which excluded from the definition of ISP those service providers who play an active role in relation to third party content, such as to confer on them knowledge or control of those data.[19]
There was consensus amongst the parties that Zalando’s sale of its own products did not constitute an ISP within the meaning of the DSA.[20] For the Partner Programm, the GC sided with the EC and concluded that Zalando qualifies as an ISP. It firstly ruled that Zalando’s service involves storing and disseminating information coming from third-party sellers (even if it is modified). The GC held in particular that the term ‘information’ should be construed broadly and includes, for example, the mere offer of products.[21]
Secondly, the GC rejected the argument that the case law concerning the e-commerce directive was applicable. The GC essentially found that the definition of ISP adopted by the Court of Justice was solely for the purpose of interpreting the liability regime of the e-commerce directive, and that it could not apply to the DSA, which set out its own liability regime.[22] The GC also noted the DSA does not explicitly state that it intends to maintain the definition of ISP.
The GC’s line of reasoning setting aside the L’Oréal ruling[23] raises some questions, however. The DSA expressly states in recitals 16 and 19 that it intends to incorporate the liability regime of the e-commerce directive and that some concepts, e.g., that of hosting service (a subcategory of ISP), as interpreted by the case law, should be maintained.
The thrust of the matter is that the Court of Justice had likely adopted a narrow interpretation of the concept of ISP to limit the scope of application of the liability exemption. Maintaining such a narrow interpretation in the DSA context would have meant limiting the reach of the DSA and of its obligations; which is most likely what the GC sought to avoid. Zalando has publicly[24] indicated that it will appeal the GC’s judgment, so it will be interesting to see if the GC’s “clarification” of the definition of ISP holds before the Court of Justice.
Zalando’s AMAR calculation by the EC correctly included all users
Zalando claimed that the AMAR should be based on recipients interacting with its Partner Programm alone. In the absence of the possibility to identify such recipients precisely, Zalando argued that the EC should apply to the total number of AMAR a percentage of 37%, corresponding of the share of sales realized through the Partner Programm. The GC disagree.
In line with the EC’s decision, the GC took the view that, under Article 3 DSA,[25] a person is considered an active recipient of an online platform simply by engaging with the service -particularly by being exposed to the content shared through the platform.[26]
Being an active recipient of an online platform does not require a purchase or transaction. It is enough for users to view product listings or information provided by third-party sellers to fall under this definition. The GC also found that it was incumbent on Zalando to identify which of its users had actually been exposed to third party content. In so far as Zalando was, on its own admission, unable to do so, the GC found that the EC correctly used to take into consideration the overall AMAR number of 83 million.[27]
The GC rejected the pleas of illegality concerning Article 33 DSA
Zalando’s appeal also took aim at the DSA itself, arguing that Article 33 DSA (the basis for the designation decision) breaches several general principles of EU law (legal certainty, equal treatment and proportionality). The GC rejected the plea in its entirety, referring in several places to the wide discretion of the legislator in making policy choices. It however brought a few interesting clarifications.
Zalando claimed that Article 33 DSA is illegal as the concept of “active recipient” is too vague, thus producing inconsistent AMAR calculations.[28] It pointed to the fact, because of this vagueness, that certain platforms have underestimated their AMAR, excluding different types of recipients, e.g. non-registered users, cookie-refusers, certain EU IPs, app users, very short visits, or bots.[29]
The GC found that the methodology to calculate AMAR may vary depending on the nature of the service but considered that the practices alleged by Zalando would not, in any case, be in line with the DSA and thus did not provide valid grounds to argue that Article 33 DSA was unclear. The GC noted in particular that platforms were not allowed to exclude users that (i) have not registered with them, (ii) have not entered into a transaction on it, (iii) have remained inactive for a certain period of time, (iv) have refused to use cookies or (v) have accessed the platform from an application.[30] While it left open the possibility of excluding users depending on the duration of their visits, it nevertheless expressed scepticism in this regard, noting, in relation to Zalando’s exclusion of users that left the platform after 10 seconds, that Zalando did not explain why such users could not be exposed to illegal content.[31]
Zalando also argued that, by merely relying on AMAR to designate platforms as VLOPs, Article 33 DSA was in breach of equal treatment, in so far as it treated marketplaces similarly to other types of platforms raising much greater systemic risks. The GC responded that the protection of consumers was one systemic risk that the DSA purported to address. It also added that Zalando had not convincingly shown that the obligations set out in Articles 34 to 43 DSA did not, even indirectly, contribute to protecting consumers.
Key take-aways
This first judgment on designation is rich and partly controversial. In summary, we learn at least that:
- Hybrid platforms will be considered intermediaries and subject to the DSA unless they can show that the intermediation activity is ancillary;
- Curating content (no longer) excludes the qualification as intermediary service provider;
- Unless hybrid platforms can distinguish amongst their users between those exposed to third party content and those who are not, the calculation of the AMAR will include all users;
- The AMAR methodology can vary depending on the nature of the platform;
- Very large marketplaces are rightly subject to all obligations of VLOPs because of the need to ensure a high level of consumer protection.
After reading this judgment, it is easy to think of the criticism recently levelled against excessive tech regulation in Europe, in particular the lack of risk-based approach.[32] Zalando is primarily a first-party retail platform that curates third-party listings and sells fashion and beauty products. Yet, because of scale alone, it faces similar VLOP obligations as services that disseminate disinformation or child sexual abuse material (CSAM) – risks of a categorically different order. One hopes enforcement will reflect that asymmetry and calibrate expectations to Zalando’s actual risk profile. For now, though, the burden looks heavy.
III. The Meta and TikTok cases: the GC quashes the EC decisions on a procedural flaw but maintain their effects
III.1 Background to the disputes
The DSA provides that the EC shall charge VLOPs and VLOSEs an annual supervisory fee to cover the estimated costs incurred by the EC ‘in relation to its supervisory tasks’.[33] Article 43 DSA provides that the EC is to adopt delegated acts laying down the detailed methodology and procedures for determining: (a) the estimated costs, (b) the individual annual supervisory fee of each VLOP and VLOSE, (c) the maximum overall limit of the fee, which may not, in any case, exceed 0.05% of a given provider’s worldwide annual net income in the preceding financial year, and (d) the detailed arrangements necessary to pay the fee.
On 2 March 2023, the EC adopted the Delegated Regulation (EU) 2023/1127 supplementing the DSA with the methodologies and procedures regarding the supervisory fees.[34] The fee for each platform is calculated inter alia by reference to that platform’s AMAR and to the sum of all platforms’ AMAR.[35]
On 27 November 2023, the EC adopted, among others, the Implementing Decisions C(2023) 8176 and C(2023) 8173 determining the supervisory fees applicable to Facebook / Instagram and TikTok respectively.
To set the fee amount in the decisions, the EC used data from two third-party companies, SensorTower and Similarweb. It applied the same method for all VLOPs and VLOSEs to calculate their AMAR in the EU and then split the total annual supervisory fee among them, based on the rules in Article 43 of the DSA and in Article 4 of the Delegated Regulation (EU) 2023/1127.
In cases T-55/24 and T-58/24, both Meta and TikTok asked the GC to annul the EC’s implementing decisions determining the amount of the annual supervisory fees applicable to them. In support of their appeal, the applicants raised several pleas concerning the fee calculation, including some contesting the legality of the Delegated Regulation. Ultimately, the GC annulled the decisions based on one plea-in-law – namely that the methodology for calculating the AMAR was set out in the wrong instrument – and declined to rule on the other pleas-in-law, including on the broader criticism of the fee calculation.
III.2 The GC’s Rulings
The GC ruled that using third-party data to calculate AMAR is lawful
The applicants criticized the EC for basing the fee amount on an estimated AMAR that used data provided by two third-party companies.[36] Instead, they claim that the EC should have used the AMAR figures reported by the service providers themselves.[37] If those figures were incomplete or incorrect, the EC should have used its powers under the DSA to request more accurate information from the providers.[38]
The GC sided with the EC and, importantly, ruled that, according to Article 24 DSA, the EC could use information other than that provided by the VLOPs to calculate the AMAR. The EC thus committed no error when relying on third party data, especially given that it had doubts about the consistency of the methodology followed by the various providers, and given that the allocation of the supervisory fees must be proportionate to the AMAR of each designated service.[39] It also found that Article 4 of Delegated Regulation does not impose any hierarchy between the data reported by the provider of the online platform, the information requested by the EC and any other information available to it.[40]
The common methodology to calculate AMAR should have been set out in the Delegated Regulation, not in the implementing decisions
The applicants criticized the EC for including the AMAR calculation method in the decisions and not in a delegated act, as required by the DSA.[41]
The GC highlighted that the concept of the ‘AMAR’ must be understood in a uniform and consistent manner, irrespectively of whether it is used for the designation of VLOPs/VLOSEs or the calculation of their supervisory fees.[42] The GC also held that under the DSA, the EC is required to adopt delegated acts that provide a detailed methodology for calculating the annual supervisory fee.[43]
Although Article 4 of the Delegated Regulation includes a formula for the calculation of the supervisory fee, it does not explain how to calculate AMAR itself.[44] Since the AMAR constitutes an essential and indispensable element in the calculation of the supervisory fee, the method for calculating it should have been included in the Delegated Regulation.[45]
The GC thus ruled that the EC infringed Article 43(3) to (5) and Article 87 DSA by adopting the methodology for calculating the AMAR in an implementing act and not in a delegated act.[46]
While the GC annulled the EC’s implementing decisions, it however decided to maintain their effects for a period not exceeding 12 months.[47] This is because the effect of the annulment would otherwise undermine legal certainty and the proper implementation of the supervisory tasks conferred by the DSA on the EC. During this period, the EC needs to establish the methodology for calculating the designated services’ AMAR in a delegated act.[48]
Key take-aways
While undeniably a legal victory for Meta and TikTok, the GC ruling was also (unsurprisingly) welcomed by the EC insofar as it confirmed that its methodology to calculate AMAR was sound.[49]
The EC “only” needs now to adopt a new delegated regulation including the AMAR calculation methodology. Given that the GC declined to rule on the other pleas raised by Meta and TikTok regarding the supervisory fee methodology, the debate on the supervisory fee is only postponed.
By leaving unanswered the question whether the EC’s reliance on third-party data to measure user numbers is fair or proportionate, it is likely that the GC will be asked by Meta and TikTok to review the new delegated regulation that the EC will adopt.
Conclusion
While it remains to be seen whether the Court of Justice will uphold the GC’s ruling in the Zalando case, it is to be expected that the EC will re-adopt its decisions in the Meta and TikTok cases, whose victories before the GC might therefore prove short-lived.
In any event, these first 3 rulings adopted by the GC send a clear signal to all the concerned online intermediaries and platforms that the GC reviews carefully the decisions taken by the EC under the DSA.
[1] Marc Barennes is a member of the Paris and New York bars, and a partner at Geradin Partners. He is a former référendaire with the General Court of the EU, a former EU Commission case-handler and a lecturer at Sciences Po. Full bio available here.
[2] Jérémie Jourdan is a partner at Geradin Partners. He was formerly Director of Competition Law and Public Policy at Vend. Full bio available here.
[3] Maria Gravvani is a qualified lawyer in Athens, Greece interning with Geradin Partners and an LSE alumna.
[4] Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market for Digital Services and amending Directive 2000/31/EC (Digital Services Act) [2022] OJ L 277/1.
[5] DSA, Recital 2.
[6] DSA, Article 2(1).
[7] DSA, Recital 9.
[8] online platforms and online search engines reaching more than 45 million users (i.e. accounting for 10% of the European population) qualify as VLOPs and VLOSEs respectively
[9] DSA, Recital 76.
[10] The list is available here.
[11] DSA, Article 43(3).
[12] Case T-348/23 Zalando SE v European Commission, ECLI:EU:T:2025:821 (“Zalando”)
[13] Case T-55/24 Meta Platforms Ireland Ltd v European Commission, ECLI:EU:T:2025:842 (“Meta”)
[14] Case T-58/24 TikTok Technology Ltd v European Commission, ECLI:EU:T:2025:843 (“TikTok”)
[15] DSA, Article 24(3).
[16] Commission Decision of 25 April 2023 designating Zalando as a very large online platform in accordance with Article 33(4) of Regulation (EU) 2022/2065 of the European Parliament and of the Council [2023].
[17] Ibid.
[18] Case C-324/09 L’Oréal SA and Others v eBay International AG and Others, ECLI:EU:C:2011:474
[19] Zalando, §38.
[20] Zalando, §26.
[21] Zalando, §29-30.
[22] Zalando, §41.
[23] Zalando, §41.
[24] See, for instance, https://fr.investing.com/news/stock-market-news/zalando-fera-appel-de-la-decision-du-tribunal-de-lue-sur-les-regles-tech-93CH-3034390
[25] DSA, Article 3(p).
[26] Zalando, §60.
[27] Zalando, §67.
[28] Zalando, §81.
[29] Zalando, §89.
[30] Zalando, §95.
[31] Zalando, §98-101.
[32] See, for example, EUTA’s recent call for a risk-based approach to regulation (here).
[33] DSA, Article 43.
[34] Commission Delegated Regulation (EU) 2023/1127 of 2 March 2023 supplementing Regulation (EU) 2022/2065 of the European Parliament and of the Council with the detailed methodologies and procedures regarding the supervisory fees charged by the Commission on providers of very large online platforms and very large online search engines [2023] OJ L149/16 (the “Delegation Regulation”).
[35] Meta, §23.
[36] TikTok, §14.
[37] Ibid.
[38] Ibid.
[39] TikTok, §31-34.
[40] TikTok, §35.
[41] Meta, §13.
[42] TikTok, §36.
[43] Meta, §36.
[44] Meta, §37.
[45] Meta, §41.
[46] Meta, §52.
[47] Meta, §64.
[48] Ibid.
[49] Reuters, Meta, TikTok win challenge against EU tech fees, forcing regulators to recalculate, September 10, 2025 (available here).
