Europe hits Meta, Apple with €700M in fines for flouting DMA

Bad timing, claim industry watchers, who say rulings could seriously upset an already delicate US-EU relationship

Meta and Apple have earned the dubious honor of being the first companies fined for non-compliance with the EU's Digital Markets Act, which experts say could inflame tensions between US President Donald Trump and the European bloc.

Apple was penalised to the tune of €500 million ($570 million) for violating anti-steering rules and Meta by €200 million ($228 million) for its "consent or pay" ad model, the EU said in a press release.

The fines are a pittance for both firms, whose most recent quarterly earnings statements from January saw Apple report $36.33 billion in net income, and Meta $20.83 billion.

Apple's penalty related to anti-steering violations - for which it's already paid a €1.8 billion penalty to the EU - saw it found guilty of not allowing app developers to direct users outside Apple's own in-app payment system for cheaper alternatives. The European Commission also ordered Apple to "remove the technical and commercial restrictions on steering" while simultaneously closing an investigation into Apple's user choice obligations, finding that "early and proactive" moves by Cupertino to address compliance shortcomings resolved the issue. 

Meta, on the other hand, was fined for the pay-or-consent model whereby it offered a paid, ad-free version of its services as the only alternative to allowing the company to harvest user data. The strategy earned it considerable ire in Europe for exactly the reason the EU began investigating it last year: That it still ingested data even if users paid and that it wasn't clear about how personal data was being collected or used. 

"The Commission found that this model is not compliant with the DMA," the EC said, because it gave users no choice to opt into a service that used less of their data, nor did it allow users to freely consent to having their data combined. 

That fine only applies to the period between March and November 2024 when the consent-or-pay model was active, however. The EU said that a new advertising model introduced in November of last year resolved many of its concerns, which European Privacy advocate Max Schrems says will likely still be an issue. 

"Meta has moved to a system with a 'pay,' a 'consent' and a 'less ads' option," Schrems explained in a statement emailed to The Register. Schrems said the "less ads" option is nothing but a distraction. 

"It has massive usability limitations - nothing any user seriously wants," Schrems said. "Meta has simply created a 'fake choice', pretending that it would overcome the illegal 'pay or okay' approach."

Alongside the fines, the EU also said that it was removing Facebook Marketplace's designation as a DMA gatekeeper, as it had too few commercial users to qualify as "an important gateway for business users to reach end users." 

Schrems' None of Your Business privacy group, which has litigated a number of privacy-related cases before the EU, may take action on the matter, but told us it had nothing to announce at this time. Nonetheless, Schrems did note in a press statement that "the case is not over." 

A tariff war escalation?

When asked about the decision, Meta didn't hesitate to use words that would potentially trigger a response from the Trump administration, which has made clear that it wouldn't hesitate to hit back at foreign governments that hamstrung US tech firms. 

"The European Commission is attempting to handicap successful American businesses while allowing Chinese and European companies to operate under different standards," Meta chief global affairs officer Joel Kaplan said. "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." 

Dirk Auer, director of competition policy at the International Center for Law and Economics, likewise expressed concern that the fines would only make international tensions worse. 

"These actions provide fodder for claims that Europe is targeting American tech champions for political reasons, not legal ones, and could provoke a cycle of escalating tariffs with consequences far beyond the digital realm," Auer said. "These fines send a troubling signal: that Europe may be prioritizing punitive enforcement over practical outcomes."

The bloc earlier this month indicated it was considering imposing tariffs on services and not just goods, bringing US tech giants within its scope, in response to Trump's blanket so-called "retaliatory tariffs." Trump later paused his broadside, lowering the increase to 10 percent for 90 days across many countries. EC President Ursula von der Leyen said at the time: "We want to give negotiations a chance. While finalizing the adoption of the EU countermeasures that saw strong support from our Member States, we will put them on hold for 90 days."

The Computer and Communications Industry Association of Europe likewise criticized the fines, calling them opaque, discretionary, and unpredictable, and noting that they could undermine the DMA.

"The Commission is redesigning business models of online platforms, moving goalposts, and limiting innovation," CCIA Europe head Daniel Friedlaender said in a statement provided to The Register. "The DMA has become highly politicised." 

The White House shared with us its displeasure at the ruling, with National Security Council spokesperson Brian Hughes calling the DMA discriminatory, and the ruling "economic extortion" that the United States won't tolerate.

"Extraterritorial regulations that specifically target and undermine American companies, stifle innovation, and enable censorship will be recognized as barriers to trade and a direct threat to free civil society," Hughes said in an emailed statement.

"The EU's malicious targeting of American companies and consumers must stop." ®