The European Commission on Wednesday fined tech giants Apple and Meta for non-complying with the Digital Market Act (DMA) on Wednesday, at risk of aggravating the current trade tensions with the US.
The tech giants have hit back signalling intent to appeal the fines and casting the EU regulatory as akin to tariffs.
The fines were at the lower end of the scale the Commission could levy, however, and the executive has also closed two cases targeting the same companies.
The Commission fined Apple €500 million after finding it was preventing developers from freely communicating with consumers and steering them to alternative channels for offers and content.
On top of the fine, the Commission imposed a cease-and-desist order to ensure effective compliance from Apple.
The executive fined Meta €200 million claiming its “pay or consent” advertising model doesn’t comply with the DMA as it implies a binary choice that forces users to consent to give their personal data to target advertising unless they pay a subscription.
These fines are relatively low, considering EU legislation provides for fines of up to 10% of annual turnover for breaches of the DMA. But according to an official, “gravity, duration and recurrence” of the violation were taken into account and, since the DMA is relatively new legislation, the duration criteria did not apply.
The Commission also closed two cases: one probe into Apple for failing to allow changes of browser choice screens for users; a second following the executive’s decision that Facebook Marketplace was not a core platform service falling under the DMA.
“Apple and Meta have fallen short of compliance with the DMA by implementing measures that reinforce the dependence of business users and consumers on their platforms,” said EU Competition Commissioner Teresa Ribera in a statement.
Since his return to power and backed by Big Tech CEOs, US President Donald Trump has put pressure on the EU over its digital regulations, accusing the Commission of taxing US tech enterprises.
The EU insists that the DMA and its sister regulation the Digital Services Act (DSA) are agnostic non-discriminatory regulations that are not up for discussion in the scope of negotiations surrounding trade tariffs, while the US administration has signalled that it views them as non-tariff barriers to trade that should be on the table in those talks.
Apple has announced it intends to appeal the Commission fine. “Today’s announcements are yet another example of the European Commission unfairly targeting Apple in a series of decisions that are bad for the privacy and security of our users, bad for products, and force us to give away our technology for free,” an Apple representative commented.
“The European Commission is attempting to handicap successful American businesses while allowing Chinese and European companies to operate under different standards,” Meta’s Chief Global Affairs Officer Joel Kaplan, claimed, adding: “This isn’t just about a fine; the Commission forcing us to change our business model effectively imposes a multi-billion-dollar tariff on Meta while requiring us to offer an inferior service.”
Apple and Meta are required to comply with the Commission’s decisions within 60 days, otherwise they risk periodic penalty payments.
The fine imposed to Meta concerns the period from March 2024 to November 2024, by which time the company had introduced changes to its ads model, which are still being assessed by the EU enforcer.
In a last case, the Commission has also charged Apple with failing to comply with the DMA by hindering users from downloading alternative app stores and apps from the web. The investigation of this case continues.
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