Stripchat loses EU court challenge over Digital Services Act label
European Union rules for the largest online platforms remain in focus as regulators press companies to police illegal and harmful content more aggressively. Stripchat, a unit of Cyprus-based Technius, loses its bid to be removed from a category that carries stricter compliance duties and potentially heavy fines.
Highlights
- Luxembourg-based General Court upheld the European Commission's decision to designate Stripchat as a very large online platform under the Digital Services Act.
- Stripchat's challenge centered on the Commission's method for calculating user numbers, but the court found the Commission provided adequate reasoning for its classification.
- DSA breaches can result in fines up to 6% of global turnover, significantly increasing regulatory and operational risks for platforms like Stripchat under intensified EU scrutiny.
General Court backs Commission designation
As reported by Reuters, the Luxembourg-based General Court rejects Stripchat's arguments against the European Commission's decision to classify the platform as a very large online platform under the Digital Services Act.The company had challenged the way the Commission calculated its user numbers, a key benchmark for deciding whether a platform falls within the DSA's toughest regime. In a court statement, the court says the Commission gave Stripchat adequate reasons for its decision.
Stripchat is a subsidiary of Cyprus-based Technius. The case is T-134/24 Technius v Commission, and the ruling can still be appealed on matters of law to the EU Court of Justice, the bloc's highest court.
Compliance burden rises for large online platforms
The European Commission designated Stripchat and two other adult content companies as very large online platforms three years ago under the DSA. That status requires companies to take stronger steps to address illegal and harmful content on their services.For companies covered by the rules, the financial stakes are significant. Breaches of the DSA can lead to fines of as much as 6% of global turnover, underscoring the regulatory and operational risks for platforms facing tougher EU scrutiny.
Our earlier article on the CTOS Digital cybersecurity incident outlined how the service disruption clouded earnings visibility and raised concerns over potential customer losses and regulatory repercussions. We noted differing analyst views on the likely recovery timeline and detailed estimates for revenue and profit impacts depending on how quickly systems resumed operations.
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