Apple and Meta, severely sanctioned by the European Commission

The companies Apple and Meta were fined, yesterday, with 700 million euros by the European Commission for non-compliance with certain provisions of the Digital Markets Act (DMA), according to a press release issued by the Brussels institution. Experts from the European Commission found that Apple violated the obligation to allow "steering" provided for by the Digital Markets Act (DMA), and Meta failed to comply with the obligation to offer consumers the possibility of choosing a service that uses less personal data. As a result, the Commission applied sanctions of 500 million euros to Apple and 200 million euros to Meta. The sanctions come after an intense and prolonged dialogue between European Commission officials and representatives of both companies, who had the opportunity to present their views and arguments in detail.

According to the quoted source, immediately after the decision to sanction the two tech giants, Teresa Ribera, Executive Vice-President of the European Commission for Clean, Fair and Competitive Transition, stated that the application of these fines sends a strong and clear message: "The Digital Markets Act is an essential tool that ensures the functioning of digital markets in a fair and competitive way. Apple and Meta have not respected these rules and have strengthened the dependence of users and businesses on their platforms, which is why we have taken firm but balanced measures".

In turn, Henna Virkkunen, Executive Vice-President of the European Commission for Technological Sovereignty, Security and Democracy, stated: "The DMA rules guarantee that citizens are in control of their data and companies can communicate freely with their customers. Today's decisions demonstrate that Apple and Meta have violated this fundamental principle and are obliged to change their behavior. We will continue to protect the rights of citizens and innovative businesses in Europe".

According to the DMA, app developers distributing their products through Apple's App Store must be able to inform customers free of charge about alternative offers available outside the App Store, direct them to these offers and allow them to make purchases. The Commission found that Apple is not complying with this obligation. Due to the company's restrictions, app developers cannot fully benefit from alternative distribution channels and consumers do not fully benefit from cheaper offers, as Apple prevents developers from communicating directly with users about these options. In its dialogue with European officials in Brussels, Apple failed to demonstrate that these restrictions are objectively necessary and proportionate. With its decision, the Commission ordered Apple to remove the technical and commercial restrictions on steering and to refrain from any similar conduct in the future, including the adoption of measures with equivalent effect. The Commission also closed its investigation into Apple's obligations regarding users' freedom of choice, following the company's early and proactive commitment to find a solution to comply.

Regarding the sanction imposed on Meta, according to the DMA, platforms considered to be "gatekeepers" must obtain users' consent for the combination of personal data between services, and those who do not consent must be offered an equivalent alternative but with a reduced level of use of personal data. In November 2023, Meta introduced the binary "consent or pay" advertising model, offering EU users of Facebook and Instagram the option of consenting to the combination of personal data for personalised ads or paying a monthly subscription for an ad-free service. The Commission concluded that this model did not comply with the DMA requirements, as it did not provide users with the specific choice required for an equivalent service but with a reduced use of personal data. Meta also failed to allow the exercise of a genuine right to refuse the combination of personal data. In November 2024, after numerous discussions with the Commission, Meta introduced a revised version of the personalised ads model, claiming to use less personal data. The Commission is currently analysing this new option and is continuing its dialogue with Meta to obtain evidence on the real impact of this change. Yesterday's decision on non-compliance covers the period during which EU users had the only option of a binary "consent or pay" model, i.e. from March 2024, when DMA became mandatory, until November 2024, when Meta introduced the new option.

The European Commission also decided that Meta's Marketplace service should no longer be designated as an online intermediary under the DMA. This decision follows a request submitted by Meta in March 2024 and a careful assessment of the company's arguments, with the Commission determining that Marketplace had fewer than 10,000 business users in 2024, meaning that it no longer meets the threshold required to be considered an essential platform for connecting businesses with end users.

Apple and Meta have 60 days to comply with the Commission's decisions, otherwise they risk additional penalties in the form of periodic payments.