European Commission Slaps Apple, Meta With Major Fines Over Non-Compliance With Digital Markets Act

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(RTTNews) - Wednesday, the Europe Commission announced that the tech giants Apple (AAPL) and Meta Platforms Inc. (META) have breached certain provisions under the Digital Markets Act or DMA, resulting in fines of 500 million euros and 200 million euros, respectively.

According to the Commission, Apple violated its anti-steering obligations under the DMA. These rules allow developers distributing apps via the App Store to inform customers about alternative and cheaper offers outside the App Store, direct them to those offers, and enable purchases.

The Commission found that Apple's breach prevented app developers from informing users about alternative and often cheaper options.

As a result, the Commission has ordered Apple to remove technical and commercial restrictions on steering and to refrain from continuing or adopting similar non-compliant practices in the future.

Meanwhile, Meta's 'Consent or Pay' advertising model was deemed non-compliant with the DMA. This model offered Facebook and Instagram users in the EU a binary choice either consent to the use of personal data for personalized ads or pay a monthly subscription for an ad-free experience.

However, the Commission concluded that the model failed to provide users with a specific alternative that used less personal data while still offering a comparable service. Moreover, it did not allow users to freely consent to the combination of their personal data.

The ruling applies to the period between March and November 2024, during which users in the EU were only given the binary 'Consent or Pay' option. In November 2024, Meta introduced a revised model allegedly using less personal data to serve ads. The Commission is currently reviewing this new option and is in ongoing discussions with Meta, requesting evidence of its practical impact.

Notably, the Commission also determined that Meta's online intermediation service, Facebook Marketplace, should no longer be designated under the DMA.

The Commission emphasized that the fines reflect the gravity and duration of the violations. Both companies are required to comply with the decisions within 60 days or face periodic penalty payments.

In the pre-market hours, Apple is trading at $205.81, up 3.05 percent, and Meta is trading at $524.82, up 4.91 percent on the Nasdaq,