EU slaps Apple and Meta with hefty fines over digital competition breaches

US blasts the decision as 'economic extortion'

The European Union on Wednesday levied fines totalling €700 million against Apple and Meta for violating key provisions of the bloc's Digital Markets Act (DMA).

The European Commission, the EU's executive arm, announced that Apple would be fined €500 million ($571 million), while Meta faces a €200 million ($228.4 million) penalty.

Both companies were found to have breached the DMA, landmark legislation aimed at curbing monopolistic behaviour among so-called "gatekeeper" tech firms and fostering fair competition in the digital economy.

According to EU officials, Apple failed to comply with the DMA's "anti-steering" rules, which mandate that app developers must be free to inform users about alternative purchasing options outside the App Store.

The Commission found that Apple imposed technical and commercial restrictions preventing such steering, effectively limiting consumer choice and reinforcing its control over in-app transactions.

The ruling orders Apple to eliminate those restrictions immediately and bars it from repeating the conduct in the future.

In a defiant response, Apple said it would appeal the fine, accusing the Commission of overreach and mischaracterising its efforts.

"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," Apple said.

The company criticised the Commission for what it described as constantly shifting regulatory expectations.

Meta, the parent company of Facebook and Instagram, was fined for forcing users to either agree to extensive data tracking for personalised ads or pay for an ad-free subscription – a model introduced across its European platforms in November 2023.

The Commission ruled that this model violated user consent principles embedded in the DMA and constituted a coercive choice rather than genuine consent.

In its defence, Meta pointed to recent changes it made to its advertising services, which it claims now use significantly less personal data. EU officials acknowledged the changes and confirmed that a further assessment is underway.

Meta's global affairs chief, Joel Kaplan, described the EU's ruling as protectionist and discriminatory.

"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," Kaplan said.

"By unfairly restricting personalised advertising the European Commission is also hurting European businesses and economies."

US criticises EU fines

Despite the fines being lower than anticipated, the US criticised the EU, branding the penalties as "economic extortion" and warning of potential consequences for EU-US trade relations.

In a statement reported by Reuters, a White House spokesperson did not mince words, saying: "This novel form of economic extortion will not be tolerated by the United States. Extraterritorial regulations that specifically target and undermine American companies, stifle innovation, and enable censorship will be recognised as barriers to trade and a direct threat to free civil society."

The administration warned that such measures could intensify already simmering tensions between the US and the EU, following similar sentiments expressed by tech executives and former US officials in recent months.

While the White House has not yet announced any specific retaliatory action, officials have not ruled out the possibility of new tariffs on EU goods.

Earlier this month, the Trump administration imposed 20% reciprocal tariffs on EU goods in response to what it characterised as "unjustified economic aggression." Those tariffs were later reduced to 10% temporarily, pending trade negotiations.