Meta and Apple have become the first companies to face sanctions under the European Union’s Digital Markets Act (DMA), a landmark regulation ensuring fair competition in digital markets. The European Commission has fined Apple €500 million and Meta €200 million for breaching obligations set out in the DMA.

Apple & Meta’s violations under the Digital Markets Act

Apple was found to have violated the DMA’s “anti-steering” rule, which prohibits gatekeepers from restricting app developers from directing consumers to alternative purchasing channels outside of the App Store. The Commission determined that Apple’s restrictions prevented developers from informing users about alternative and potentially cheaper offers. These constraints also made it difficult for users to take advantage of better deals outside the Apple ecosystem.

The Commission concluded that Apple failed to demonstrate that these limitations were objectively justified or proportionate. In addition to the €500 million fine, Apple has been ordered to remove all technical and commercial restrictions that limit developers’ ability to steer users to alternative options.

Meta was found non-compliant due to its “consent or pay” advertising model. Under this approach, users of Facebook and Instagram in the EU had to either consent to combining their data for personalised ads or pay a monthly subscription for an ad-free experience. The Commission found this model incompatible with the DMA, citing the lack of genuine, freely given user consent.

In 2024, Meta introduced a version of its platform that allegedly uses less personal data to deliver personalised ads. The European Commission is assessing whether this new model complies with the DMA.

Apple and Meta have 60 days to comply with the Commission’s decisions. Failure to do so could result in periodic penalty payments, up to five per cent of their average daily turnover.

The innovative nature of the Act 

The Digital Markets Act (DMA) is a landmark piece of European Union legislation, the first of its kind under competition law, aimed at making digital markets fairer and more open. It specifically targets large digital platforms that hold significant power in the digital economy. Once they meet certain defined criteria, these platforms are designated as gatekeepers. Gatekeepers typically provide core platform services such as online search engines, app stores, social media networks, internet browsers, and other key digital infrastructures.

Once a company is designated as a gatekeeper, it must comply with various obligations and prohibitions under the Act. These rules prevent unfair practices and promote a level playing field for smaller players and business users.

Under the DMA, gatekeepers must allow third parties to interoperate with their services in specific situations. They must also ensure that business users can access data generated from their interactions on the gatekeeper’s platform. Additionally, gatekeepers must provide advertisers and publishers with the tools and information they need to verify the performance of advertisements hosted on the platform independently. Business users must also be allowed to promote their offers and conclude contracts with their customers outside the gatekeeper’s ecosystem, meaning they are not restricted to the gatekeeper’s platform when conducting business.

On the other hand, the DMA prohibits several anti-competitive behaviours that gatekeepers have traditionally engaged in. They are not allowed to give their products or services preferential treatment in rankings, especially compared to similar offerings by third parties on the same platform. Gatekeepers cannot prevent consumers from linking up with businesses outside their platforms, nor can they block users from uninstalling pre-installed software or applications. Importantly, gatekeepers are prohibited from tracking users across different services for targeted advertising unless those users have provided clear and informed consent.

For consumers, the Digital Markets Act offers several new freedoms and protections. Users can now install apps directly from the web or smartphones, bypassing the gatekeeper’s proprietary app store. Introducing “choice screens” makes selecting their preferred browser and search engine easier, enhancing consumer autonomy. Moreover, the DMA grants consumers greater control over their data. They are empowered to decide how their information is used across various services and can transfer their data to a platform they choose. Search results are now more relevant and less cluttered with unwanted promotions, giving users access to more neutral and useful information.

The Digital Markets Act imposes strict penalties to ensure compliance. Companies that violate the rules can be fined up to 10 per cent of their worldwide annual turnover. In cases of repeated infringement, this fine can be increased to as much as 20 per cent. These sanctions underscore the seriousness with which the European Commission intends to enforce fairness and accountability in the digital economy.

Looking ahead

Regulatory scrutiny over dominant digital platforms is intensifying globally, with significant developments pointing to a new era of enforcement in competition law. In the United States, the Department of Justice (DOJ) and Google have returned to federal court for a remedy hearing following a landmark decision that found Google maintained an illegal monopoly in online search and digital advertising. The judgment, delivered in 2024, concluded that Google had used its dominance to suppress competition, primarily by entering into agreements with internet browsers and smartphone manufacturers, such as Apple and Android, that made Google the default search engine. These arrangements effectively shut out rival search engines, limiting consumer choice and stifling market competition.

The DOJ has proposed a sweeping set of remedies in response. These include potentially requiring Google to divest from key assets such as its Chrome browser and, possibly, the Android operating system. In addition, the DOJ wants to bar Google from entering into exclusive contracts and acquiring or owning stakes in competing search services. 

These proposed measures reflect an increasingly interventionist stance by regulators who are no longer hesitant to consider structural remedies, such as divestiture, when addressing anti-competitive conduct in digital markets. The growing willingness of regulators to enforce the separation of business units, ban exclusivity contracts, and fine dominant firms signals a shift towards more assertive regulation.

This global momentum suggests a possible ripple effect influencing competition policy in other jurisdictions, including emerging markets. Countries with technology companies that exhibit similar dominance or platform behaviours may soon face similar regulatory expectations. As such, it is becoming increasingly important for companies operating in digital markets to anticipate regulatory developments and align their practices with evolving global standards of fair competition.