TikTok to pay $400m to US in one of largest child privacy settlements

TikTok has agreed to pay $400m (£293m) to the US government in a landmark child privacy settlement, one of the largest such penalties ever imposed. The agreement stems from a 2024 lawsuit by the Department of Justice under the previous administration of President Joe Biden. The DOJ alleged that TikTok and its parent company ByteDance collected extensive data from millions of users under the age of 13, violating the Children's Online Privacy Protection Act (COPPA) enacted in 2000.

COPPA, a federal law, mandates parental consent for data collection from children under 13. Assistant Attorney General Brett Shumate stated that the settlement would better protect children and parents compared to when the case began. Other major companies that have paid penalties for COPPA violations include Google's YouTube in 2019 ($170m) and Epic Games in 2022 ($275m).

Meta, or Facebook's parent company, is currently facing potential penalties exceeding hundreds of billions of dollars for alleged COPPA violations by 29 US states. A jury trial commenced this week, with Meta accused of profiting from targeted advertising to child users. Although the TikTok lawsuit predated last year's separation of its US business from its original Chinese operations, the settlement only covers TikTok's activities in China.

ByteDance, ByteDance, the privately held company behind TikTok, was recently valued at $550bn. The settlement requires immediate payment of $300m by TikTok and ByteDance, with an additional $100m due upon the government's dismissal of a 2019 consent decree with the Federal Trade Commission.