Apple and Meta fined €500 million and €200 million respectively for DMA violations; White House responds with 'economic extortion'
The European Commission, the EU's executive body, has announced that it will impose fines of 500 million euros (approximately 790 million yen) and 200 million euros (approximately 300 million yen) on Apple and Meta for violating the EU's Digital Markets Act (DMA). The investigation has been ongoing for some time, but
Commission finds Apple and Meta in breach of the Digital Markets Act
https://ec.europa.eu/commission/presscorner/detail/en/ip_25_1085
According to the European Commission's announcement, Apple's violation was that it had not complied with its obligations to 'make app developers who distribute apps via the App Store aware of alternative offers outside the App Store free of charge and to allow them to purchase those offers.'
It has been pointed out that Apple imposes numerous restrictions on app developers, preventing them from taking advantage of alternative distribution channels, and that Apple prevents developers from directly notifying them of alternative offers, preventing consumers from making full use of cheaper alternative offers.
Meta's violations, on the other hand, are that it does not comply with the following rule: 'User consent is required when combining personal information between services, and users who do not consent must have access to an equivalent, non-personalized alternative.'
Meta's 'Consent or Pay' model, introduced in November 2023, asks Facebook and Instagram users to either agree to combine their personal data for personalized advertising in exchange for free use, or pay to use the service without ads. After being pointed out that the model may violate consumer protection laws, Meta has offered an option to reduce the amount of personal data used when displaying ads in November 2024.
'The European Commission is allowing Chinese and European companies to operate under different standards while handicapping successful American companies,' said Meta's Joel Kaplan in a statement. 'This isn't just about fines. The European Commission's decision to force Meta to change its business model is effectively the equivalent of a multi-billion dollar tariff and a requirement that it provide a lower quality service. The Commission is also hurting European businesses and economies by unfairly restricting personalized advertising.'
Meta's Statement in Response to the European Commission's Decision on the Digital Markets Act | Meta
A White House spokesperson also issued a similar statement to Meta, saying, 'The DMA is discriminatory. The United States will not tolerate these new forms of economic extortion. We view these extraterritorial restrictions, in particular those that target American companies, undermine innovation, and enable censorship, as a barrier to trade and a direct threat to free civil society.'
US calls EU fines on Apple and Meta 'economic extortion' | Reuters
Teresa Rivera, Executive Vice-President for Competition at the European Commission, said: 'This decision sends a strong and clear message. The Digital Markets Act is a key regime for unlocking potential, choice and growth in the digital sector by enabling companies to operate in competitive and fair markets. It protects European consumers and levels the playing field. Apple and Meta have failed to comply with the DMA by taking measures that make business users and consumers more dependent on their platforms. As a result, we have taken firm and proportionate enforcement action against both companies, based on clear and predictable rules. All companies operating in the EU must obey EU law and respect European values.'
Both companies are required to pay the fine within 60 days, and if they fail to pay within the deadline, they may be asked to pay additional fines. DMA violations are punishable by a fine of up to 10% of annual turnover if they are serious, and up to 20% if the violations are not improved. However, the amount of the fines this time is less than 1% of the annual turnover of both companies.
Regarding the amount of these fines, in the case of Google, a total of more than 400 billion yen has been imposed in 2024, but it has been pointed out that these are a very small amount compared to its sales revenue and do not function as a deterrent.
Google was fined more than 400 billion yen in total in 2024, but it's meaningless because it's only an amount that could be earned in just 16 days - GIGAZINE
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