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Comment by DrScientist | Hacker News Reader

The Irish regulator is acting on behalf of the EU as TikTok European head quarters are in Ireland.

And in terms of jurisdiction - it's a bit like you visiting Ireland on holiday and committing a crime - and then arguing they have no jurisdiction over you as you are only there for 2 weeks.

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A more apt comparison is that you get a fine for speeding abroad, and argue that you don't have to pay it because you earned that money in your home country.

It's ridiculous.

Sure, it's fine for Ireland to punish someone for a crime committed in Ireland, but my question was about what bearing revenue earned on other continents was any business of Ireland's.

A more accurate version of your analogy would be Ireland choosing to punish a tourist for littering with a dramatically higher penalty than native Irish would face based on their New York salary.

Because, like many other tech companies, Tiktok is funneling most of their global revenue through Ireland where the corporate tax rate is very low. I don't know the specifics of the mechanism used by Tiktok. But, most companies do this by registering all of their IP through their Irish company and then paying licensing fees to the Irish entity that just happen to be all of their profit abroad. This is why the Irish regulator punches way above its weight globally and is why it is often the entry point for EU regulation on foreign firms.

Maybe Alibaba is a better example. Why should Alibaba increasing its global revenue through growth in the Chinese market mean that Ireland should fine it more? If it's because earnings in Ireland or even maybe the entire EU went up, then I can see the justification. But if Alibaba's revenue is going up because of Alibaba improving logistics within China, why should Ireland get anything for that?

In Tiktok's case it's because the revenue is actually flowing through Ireland.

EDIT: here's more about the general mechanism I'm referring to https://archive.is/0hcAK

One of TikTok’s largest markets is Japan. Their shop revenues in particular, doubled in Japan last year. Those earnings are taxed locally and have nothing to do with Ireland.

I suggest reading the link I posted.

I did, in 2023.

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