Prime Highlights

• Apple and Meta fined under EU’s Digital Markets Act (DMA) in historic antitrust enforcement.
• Apple fined €500 million; Meta fined €200 million for non-compliant digital practices.

Key Facts

• Apple prohibited app developers from steering users to alternative payment options.
• Meta’s “pay or consent” model did not provide true user choice on data tracking.

Key Background

The European Commission has made a bold move against the technology giants by issuing the first fines under the newly enforced Digital Markets Act (DMA), a breakthrough in regulating Europe’s digital sector. The DMA, effective since May 2023, seeks to break the monopolistic dominance of digital “gatekeepers”—firms that have the gate to digital markets—by compelling them to practice equal competition and provide open user choice.

Apple was slapped with a €500 million penalty for forcing what the Commission deemed “anti-stealing” measures within Apple’s App Store. They prevented application developers from notifying consumers of alternative, often less expensive, payment channels independent of Apple’s ecosystem. In the EU’s opinion, this restraint suppressed competition and denied consumers the ability to make choices. Apple, a longtime defender of its closed system as a way of ensuring user privacy and security, said it would appeal the ruling on the basis that the directive could undermine data protection.

The parent company of Facebook and Instagram, Meta, was also fined €200 million for having recently introduced a “pay or consent” model across Europe. In this model, users must either consent to permit tracking of their information for targeted advertising or subscribe to access the platforms free from ads. The Commission determined that this binary choice was not true consent and watered down users’ rights over their information. Meta justified its model as open and compliant but is also going to appeal legally.

These enforcement measures reflect the EU’s determination to safeguard big tech players in books under the DMA. They are a manifestation of wider concern about the wielding of digital power and the potential harms to consumers and smaller competitors alike. The Commission has made it clear visibly that non-compliance would carry severe financial and reputational penalties, marking a new chapter in the regulation of digital markets in Europe.