Apple and Meta hit with massive EU fines over DMA breaches
The EU has fined Apple and Meta for breaching the Digital Markets Act
Today, the EU has imposed fines on both Apple and Meta for breaching elements of the Digital Markets Act (DMA). Apple has failed to comply with the DMA’s rules for alternative app stores, while Meta’s “consent or pay” advertising model has breached the DMA’s personal data rules.
Apple has been fined €500 million because of the restrictions that they have placed on 3rd party app stores. These restrictions prevented app developers from accessing the benefits of 3rd party stores. Apple also prevented consumers from accessing alternative/cheaper offers, as Apple prevented developers from informing their customers of these offers.
Epic Games has commented on the ruling, calling out Apple’s “pattern of malicious compliance.” They also state that Apple is “breaking the law by imposing illegal fees, scare screens and restrictions on purchases made outside the App Store.”
Under the DMA, app developers distributing their apps via Apple’s App Store should be able to inform customers, free of charge, of alternative offers outside the App Store, steer them to those offers and allow them to make purchases.
The Commission found that Apple fails to comply with this obligation. Due to a number of restrictions imposed by Apple, app developers cannot fully benefit from the advantages of alternative distribution channels outside the App Store. Similarly, consumers cannot fully benefit from alternative and cheaper offers as Apple prevents app developers from directly informing consumers of such offers. The company has failed to demonstrate that these restrictions are objectively necessary and proportionate.
Meta has received a €200 million fine for its “consent or pay” advertising model. Under the DMA’s rules, Meta (a Gatekeeper) must seek users’ consent before combining personal data between services and offer them a non-consent option. This alternative should be less personalised and equivalent to the standard consented option.
Instead of abiding by these rules, Meta allowed users of Facebook and Instagram to avoid personal data combination by using a monthly paid ad-free service subscription. Users had no free option to prevent their Facebook and Instagram data from being combined. This is against DMA rules.
Under the DMA, gatekeepers must seek users’ consent for combining their personal data between services. Those users who do not consent must have access to a less personalised but equivalent alternative.
In November 2023, Meta introduced a binary “Consent or Pay” advertising model. Under this model, EU users of Facebook and Instagram had a choice between consenting to personal data combination for personalised advertising or paying a monthly subscription for an ad-free service.
The Commission found that this model is not compliant with the DMA, as it did not give users the required specific choice to opt for a service that uses less of their personal data but is otherwise equivalent to the “personalised ads” service. Meta’s model also did not allow users to exercise their right to freely consent to the combination of their personal data.
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