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Landmark EU Tech Rules Target Apple and Meta with Imminent Charges

Apple and Meta Platforms may face charges for not following new EU rules designed to limit their power, according to sources.



Apple and Meta Face EU Charges For Violating new Digital Rules

The European Commission began investigating these companies and Google in March under the Digital Markets Act (DMA). This act aims to create more competition by giving smaller companies a chance and making it easier for users to switch between different online services.


EU regulators plan to issue preliminary findings, which are like initial charges, before the summer break in August. Apple is expected to be charged first, followed by Meta. While the European Commission and Meta did not comment, Apple stated in March that it believes its plans comply with the DMA and that it is working with the Commission.


Before a final decision is made, which could include fines of up to 10% of a company's global annual revenue, companies can offer solutions to address the concerns raised. This decision is expected before EU antitrust chief Margrethe Vestager leaves office in November.


The EU is looking into Apple's rules that prevent app developers from informing users about alternative offers outside the App Store for free, as well as new fees on developers. Another investigation into Apple's Safari web browser will take more time. Meta's preliminary findings focus on its new subscription model for an ad-free Facebook and Instagram.


The Financial Times was the first to report on the potential charges against Apple.


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Key Points


  1. Imminent Charges for Non-Compliance:  Apple and Meta Platforms are likely to face charges from the European Commission for not adhering to the new EU Digital Markets Act (DMA), which aims to curb their market power and foster competition.

  2. Focus of EU Investigations:  The EU is investigating Apple's restrictive rules on app developers and its fees, as well as Meta's subscription model for ad-free access to Facebook and Instagram. Preliminary findings will be issued before the summer break in August, with Apple expected to be charged first.

  3. Potential Financial Penalties:  Companies found in breach of the DMA could face fines of up to 10% of their global annual revenue if they do not address the EU's concerns before a final decision, anticipated before EU antitrust chief Margrethe Vestager's term ends in November.



FAQs


Q. What is the Digital Markets Act (DMA)?

The DMA is a new set of rules by the EU designed to promote fair competition by limiting the power of big tech companies and making it easier for smaller companies to compete.


Q. Why are Apple and Meta being investigated?

Apple and Meta are being investigated for not complying with the DMA. The EU is looking into Apple’s rules that restrict app developers and Meta’s new subscription model for ad-free services.


Q. Can Apple and Meta avoid fines?

Yes, Apple and Meta can offer solutions to address the EU’s concerns before a final decision is made.


Q. What could happen to Apple and Meta if they are found guilty?

If Apple and Meta are found guilty of not following the DMA, they could face fines of up to 10% of their global annual revenue.


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