The European Union has taken its first enforcement actions under the Digital Markets Act (DMA), imposing significant penalties on two American tech giants. The European Commission announced fines totaling €700 million against Apple and Meta for violations of the bloc's digital competition rules, marking a pivotal moment in the EU's efforts to regulate large technology platforms.
Apple's €500 Million Fine for App Store Anti-Steering Practices
The European Commission has fined Apple €500 million (approximately $570 million) for violating the DMA with its App Store anti-steering practices. The Commission determined that Apple prevented developers from steering customers outside its App Store to access cheaper deals or alternative payment options. These restrictions prohibited developers from promoting pricing or alternative distribution channels within their apps and limited their ability to freely link out to web pages where customers could pay or subscribe to their services.
Meta Penalized €200 Million for Pay or Consent Model
Meta received a €200 million (approximately $230 million) fine for its controversial pay or consent system implemented on Facebook and Instagram. The Commission concluded that Meta did not provide users with a less personalized but equivalent version of its platforms and did not allow users to exercise their right to freely consent to the combination of their personal data. Meta introduced this system in November 2023, requiring users to either pay a subscription fee to avoid data collection or agree to share their data to continue using the platforms for free.
Compliance Timeline and Potential Additional Penalties
Both companies have been given 60 days to comply with the ruling or face additional periodic penalty payments. The European Commission emphasized that the size of Apple's fine takes into account the gravity and duration of the non-compliance. Apple has been ordered to remove restrictions on developers linking out to and promoting other payment services, while Meta must address issues with its data consent practices.
EU DMA Fines Summary:
- Apple: €500 million ($570 million) for App Store anti-steering practices
- Meta: €200 million ($230 million) for "pay or consent" data model
- Compliance deadline: 60 days to implement changes
- Maximum potential DMA penalties: Up to 10% of annual global revenue for violations, 20% for repeat offenses
Tech Giants Plan to Appeal
Both Apple and Meta have confirmed their intentions to appeal the rulings. Apple spokesperson Emma Wilson criticized the decision, stating: 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. The company claims it has spent hundreds of thousands of engineering hours and made dozens of changes to comply with the DMA.
Meta's Response and Business Model Concerns
Meta's chief global affairs officer Joel Kaplan, a prominent Republican and Trump ally, issued a strong rebuke of the decision, claiming: The European Commission is attempting to handicap successful American businesses while allowing Chinese and European companies to operate under different standards. Kaplan further argued that forcing Meta to change its business model effectively imposes a multi-billion-dollar tariff on Meta while requiring us to offer an inferior service.
DMA Enforcement and Broader Investigations
The Digital Markets Act became law in May 2023 and is designed to increase competition across digital markets within the EU. Companies designated as gatekeepers — including Apple, Meta, Alphabet, Amazon, ByteDance, and Microsoft — must comply with rules intended to reduce anticompetitive behavior. The Commission is also investigating Google's parent company Alphabet over concerns regarding preferential treatment of its own services in Search rankings compared to third-party rivals.
Political Context and US-EU Tensions
The fines come amid rising tensions between European policymakers and US President Donald Trump, who has criticized EU digital laws and taxes as non-tariff barriers to trade. Trump has already imposed 25-percent tariffs on steel, aluminum, and auto imports from the EU, which Brussels hopes he will lift after an agreement. The timing of these fines could potentially exacerbate trade tensions, though reports suggest the EU Commission that took office in December may be more focused on enforcing compliance than issuing maximum penalties.
Previous EU Antitrust Penalties:
- Apple: €1.84 billion ($2 billion) in 2023 for App Store practices (Spotify case)
- Meta: €797.7 million ($840 million) in 2023 for Facebook Marketplace integration
- Meta: €1.2 billion ($1.3 billion) in 2023 for EU-US data transfer violations
Previous EU Antitrust Actions Against Tech Giants
This is not the first time these companies have faced EU penalties. Apple was previously fined €1.84 billion (about $2 billion) last year over App Store anti-steering practices following an antitrust lawsuit filed by Spotify. Meta was fined €797.7 million (about $840 million) in November last year for giving itself unfair market advantages by linking Facebook and Marketplace, and €1.2 billion (about $1.3 billion) in 2023 for transferring Facebook data of EU citizens to the US.