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European Union regulators on Monday threatened to fine Tik Tok about potentially addictive features in a version of its app called TikTok Lite, which was released to work better on slower wireless networks.
The EU investigation adds to TikTok’s regulatory challenges as the US Senate prepares to vote on a bill that would order the app’s owner, Chinese internet company ByteDance, to sell TikTok or be banned. The company is under increasing pressure over its ties to China, its data collection practices and its potentially harmful effects on children.
In Europe, the the authorities said TikTok did not conduct a legally required risk assessment before introducing new features that allow users to earn rewards such as gift cards for watching videos, liking content and following certain creators. They said the features created a financial incentive to spend more time on the app, creating risks of addiction and mental health problems, particularly for children.
The action announced on Monday is the second EU investigation against TikTok, along with another question focused on the lack of effective age verification protections and addictive design features.
In the U.S, Lawmakers approved legislation last week aimed at forcing ByteDance to sell the social media app. The Senate is expected to vote this week on the bill, which comes bundled with a package of relief bills. The White House and members of Congress have expressed concern that TikTok poses a national security risk because the Chinese government could use the app to gain access to Americans’ data or run a disinformation campaign.
TikTok Lite is best known in countries like India, Brazil, and Indonesia, but was more recently introduced in Spain and France. The app uses less memory to run on phones designed for lower speed wireless networks.
Under the Digital Services Law, an EU law passed in 2022 to regulate social media platforms, large companies like TikTok must submit risk assessments before introducing major changes to their products or services. Authorities said TikTok failed to submit the necessary information before introducing the reward features, even after regulators submitted a request last week.
TikTok said the Lite app, which has only been launched in testing in France and Spain, is available only to adults whose age has been verified by sending them a selfie with a photo ID or credit card authorization. There is a daily limit of one hour for tasks related to viewing video content.
“We are disappointed with this decision,” TikTok said in a statement. “We will continue discussions with the commission.”
TikTok has until April 23 to submit a risk assessment report to the European Commission, the executive branch of the 27-nation bloc, and until May 3 to provide the rest of the requested information. If it doesn’t, regulators said they could impose fines of up to 1 percent of the company’s annual revenue, as well as additional “periodic penalties” of up to 5 percent of TikTok’s average daily revenue.
