EU fines Apple and Meta $797 million for market regulation breach

The European Union (EU) antitrust regulators have fined iPhone maker Apple ($570 million) and Zuckerberg’s Meta ($227 million) in what it called a landmark legislation aimed at clamping down on the power of Big Tech companies. Alphabet’s Google and Elon Musk’s X are also facing potential fines from the European regulators.

The fines come a year after the EU launched an investigation into whether the companies complied with the Digital Markets Act (DMA), which seeks to open doors to smaller tech companies in a market exclusively dominated by the biggest companies.

The regulators stated that firm and balanced enforcement action was taken against both companies based on clear and predictable rules. It added that all companies operating in the EU must follow its laws and respect European values.

“Apple and Meta have fallen short of compliance with the DMA by implementing measures that reinforce the dependence of business users and consumers on their platforms. All companies operating in the EU must follow our laws and respect European values,” EU antitrust chief Teresa Ribera said in a statement.

With the fines, the EU has sent signals that it is committed to strictly implementing the DMA rules introduced in 2023. In what could be another trade war, the EU fines could raise tensions with the U.S. after President Donald Trump threatened to levy tariffs against countries that penalise U.S. companies.

When reacting to the EU market competition rule, Trump cited the DMA in February with vows to “defend American companies and innovators from overseas extortion”. Imposing the fines could therefore be interpreted to mean that the European Commission has launched an attack, with a potential response from Trump.

In its response, Apple said the EU’s decision is unfair for its activities and to users, and it would challenge the fine. 

“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 in a statement.

Meta, which owns Instagram, Facebook, and WhatsApp, also criticised the decision, stating that the European Commission is attempting to handicap successful American businesses while allowing Chinese and European companies to operate under different market regulations.

“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,” Chief Global Affairs Officer Joel Kaplan added. 

Also Read: Meta, Apple, Netflix, 3 other big tech coys accused of $278bn tax evasion over 10 years.

Experts have noted that the fines are minimal compared to the penalties they would have received under the previous EU antitrust chief, Margrethe Vestager. Reports also gathered that the fines are modest owing to the short period of the breaches, a focus on compliance rather than sanctions, and a desire to avoid possible retaliation from Trump.

The EU’s decision to erect a perfectly competitive market, especially for small companies, follows an ongoing U.S. antitrust case against Google. The popular search engine was found to legally dominate two markets for online advertising technology, where it might be forced to sell Chrome and break up its ad products if found guilty.

Other EU fines on Meta & Apple

Alongside the fines, the EU competition watchdog said Apple must remove technical and commercial restrictions that prevent app developers from steering users to alternative and cheaper deals outside its App Store.

The iPhone maker was also charged with breaching DMA rules on the grounds that it prevented users from sideloading, a practice that involves downloading alternative app stores and apps from the web. Regulators then criticised Apple’s conditions, which include a new fee called Apple’s Core Technology Fee, saying these serve as a disincentive for developers to use alternative app distribution channels on its mobile operating system iOS.

On a positive note for the iPhone maker, it avoided a fine in a separate investigation into its browser options on iPhones. This follows recent modifications that allow users to switch to a rival browser or search engine more easily. EU Regulators noted that these comply with the DMA and closed the investigation on Wednesday.

For Meta, the EU said its pay-or-consent model introduced in November 2023 breached the DMA. Between that period and November 2024, Meta was alleged to have tweaked the model by using less personal data for targeted advertising. The company has been discussing with the authorities on the new version it introduced in November. 

However, the EU regulator dropped Meta’s Marketplace’s designation as a DMA gatekeeper because the number of users fell below the required threshold.

EU lawmaker Andreas Schwab urged the Commission to maintain its investigations against Google’s lucrative adtech business and Elon Musk’s X and not delay decisions. “There can be no leeway in enforcement as this may also impact the importance of competition policy in general.” 

The Commission’s fines come after a report by the UK-based not-for-profit Fair Tax Foundation (FTF) accused Amazon, Meta, Alphabet, Netflix, Apple, and Microsoft of $278 billion in tax fraud in the U.S. corporate income taxes over the past 10 years.