Apple Hit with €500 Million Fine and Meta Charged €200 Million for Violating EU Regulations
Apple has been fined €500 million and Meta €200 million, as European Union antitrust regulators imposed the first penalties under groundbreaking legislation designed to limit the influence of Big Tech.
The fines may escalate tensions with US President Donald Trump, who has threatened to impose tariffs on countries that penalize American companies.
These actions come after a year-long investigation by the European Commission, the EU’s executive arm, to determine whether the companies are adhering to the Digital Markets Act, which aims to enable smaller rivals to enter markets dominated by the largest firms.
Apple stated that it plans to contest the EU fine.
Meta also expressed disapproval of the EU’s decision.
“The European Commission is attempting to hinder successful American businesses while permitting Chinese and European companies to operate under different standards,” it said in an emailed statement.
“This situation is not merely about a fine; the Commission is obligating us to alter our business model, effectively imposing a multi-billion-dollar tariff on Meta while demanding we provide an inferior service,” Meta asserted.
“By unjustly restricting personalized advertising, the European Commission is also causing harm to European businesses and economies,” added Joel Kaplan, Meta’s Chief Global Affairs Officer.
The fines are relatively modest when compared to the penalties imposed by the previous EU antitrust chief Margrethe Vestager during her tenure.
Sources, who preferred to remain anonymous, indicated that this is attributed to the short duration of the breaches, a focus on compliance rather than punitive measures, and a desire to avoid potential backlash from Trump.
The EU competition authority mandated that Apple eliminate technical and commercial barriers preventing app developers from directing users to more affordable options outside the App Store.
It noted that Meta’s pay-or-consent model, introduced in November 2023, contravened the DMA.
This model offers Facebook and Instagram users a free service funded by advertising revenues, provided they consent to being tracked, or the option to pay for an ad-free experience.
Meta is currently in discussions with the EU regarding a new version of the model introduced in November last year. Both companies have a two-month period to comply with the orders or face daily fines.
Apple avoided a penalty in a different investigation concerning its browser options on iPhones after making adjustments that allow users to more easily switch to competing browsers or search engines. Regulators concluded that these changes comply with the DMA and officially closed the investigation today.
However, the iPhone maker was still found in violation of DMA rules for impeding users from sideloading, which involves downloading apps and alternative app stores from the internet.
Regulators criticized Apple’s terms, including a new fee termed Apple’s Core Technology Fee, asserting that these create disincentives for developers to utilize alternative app distribution channels on its mobile operating system, iOS.
The EU regulator also reclassified Meta’s Marketplace, removing its designation as a DMA gatekeeper due to a decline in user numbers below the required threshold.
“We have taken decisive but balanced enforcement action against both companies, based on clear and predictable regulations. All enterprises operating in the EU must comply with our laws and uphold European values,” stated EU antitrust chief Teresa Ribera.
EU lawmaker Andreas Schwab urged the Commission to continue its investigations into Google’s lucrative adtech business and Elon Musk’s X, emphasizing the need for timely decisions.
“Enforcement must be unwavering, as any leniency may affect the significance of competition policy in general,” he remarked, adding that decisions seemingly linked to trade policy issues are “dangerous for the entire European Union framework.”
Reuters had reported on the EU’s decisions regarding Apple and Meta last month.
