WebGroup Czech Republic, the parent company of XVideos, has lost its appeal against the European Commission’s requirement to disclose its advertisers under the Digital Services Act (DSA).

The European Union Court of Justice rejected the company’s request to be temporarily exempted from the obligation while it continues its main legal challenge.

The ruling marks a significant moment in the ongoing debate over transparency in digital advertising, particularly for Very Large Online Platforms (VLOPs), a classification under the DSA that applies to platforms with at least 45 million active users in the EU. Alongside XVideos, other adult platforms such as Pornhub and Stripchat have also been designated as VLOPs and are subject to similar obligations.

In its appeal, WebGroup Czech Republic argued that disclosing its advertisers would violate the confidentiality rights of both the company and its advertising partners, some of whom are individual content creators. The company warned that making such information public could expose advertisers to potential doxxing or harassment.

However, the EU’s top court sided with the European Commission, stating in its ruling that the broader public interest in transparency outweighed WebGroup’s concerns.

“By the decision at issue, the European Commission designated XVideos as a very large online platform,” the court’s opinion reads. “[The] President of the General Court… held that the interests defended by the EU legislature prevailed, in the present case, over the interests of WebGroup Czech Republic and of third parties.”

In simpler terms, the court found that WebGroup failed to justify why it should be exempt from the transparency rules that apply to other VLOPs.

The DSA, which came into force in 2022, is one of the most sweeping regulations governing digital services in the European Union. It requires platforms classified as VLOPs to publish a publicly accessible database of their advertisers, among other compliance measures aimed at curbing illegal content, disinformation, and harmful online activity.

For platforms like XVideos, the regulation presents a unique challenge. Unlike mainstream tech companies, adult platforms operate in a highly stigmatized industry, where advertisers may be hesitant to have their names publicly linked to explicit content.

As part of its challenge, WebGroup’s lawyers argued that the forced disclosure of its advertising partners could have serious financial consequences. The company claimed that the requirement would deter existing and potential advertisers, potentially jeopardizing its business model, which is heavily reliant on ad revenue.

However, the EU court dismissed these concerns, noting that WebGroup Czech Republic failed to provide sufficient evidence that complying with the law would threaten the company’s financial viability.

Meanwhile, adult platforms classified as VLOPs have reported declining visitor numbers in recent months. DSA compliance reports from Pornhub, XVideos, and Stripchat indicate reduced traffic volumes, which could ultimately affect their status as VLOPs.

EU regulators acknowledge that if a platform’s user base falls below the 45 million threshold, it could be reclassified and no longer subject to the stricter DSA obligations.

“If a VLOP falls under the threshold, un-designation is indeed possible, and then the general DSA obligations would apply to such a platform,” said Thomas Regnier, a spokesperson for the European Commission, in a statement to Euractiv.

Industry observers note that the combination of DSA compliance burdens and state-level age-verification laws in the U.S. is putting additional pressure on adult platforms, forcing them to rethink their operations.

The EU’s decision against WebGroup Czech Republic comes amid a wider regulatory push targeting adult content online.

In the U.S., states have enacted laws requiring porn sites to implement strict age-verification measures, which have resulted in major platforms such as Pornhub pulling out of certain markets. Research from NYU’s Center for Social Media & Politics has shown that these laws have not stopped users from accessing adult content but have instead driven them toward unregulated and potentially riskier sites.

At the same time, the EU’s transparency requirements are forcing adult platforms to reveal key business relationships, raising concerns within the industry about privacy and security risks for advertisers and content creators.

Despite these challenges, the European Commission has remained firm in its stance that greater transparency is necessary for digital platforms, regardless of industry.