The European Commission has issued its first non-compliance decisions under the Digital Markets Act (DMA). On April 22 the body fined tech giants Apple and Meta, saying its action demonstrates clear commitment to fair practices and consumer rights in the digital ecosystem.
Apple’s Steering Terms Violation
Apple has faced scrutiny for its restrictive steering terms, which hinder app developers from freely informing customers about alternative offers outside the App Store. The Commission found that these restrictions prevented app developers from maximizing the potential of alternative distribution channels and blocked consumers from accessing cheaper offers. The Commission ordered Apple to remove these technical and commercial barriers, ensuring that both developers and consumers can benefit from a more open and competitive market.
Meta’s Consent or Pay Model Violation
Meta’s “Consent or Pay” model, introduced in November 2023, has also run afoul of the DMA. The model required EU users of Facebook and Instagram to choose between consenting to personal data combination for personalized advertising or paying for an ad-free service. This binary choice failed to offer a less personalized but equivalent alternative, violating users’ rights to freely consent to the use of their personal data. Although Meta introduced a new ads model in November 2024, the Commission’s decision addresses the period during which the non-compliant model was in effect.
It Wasn’t All Bad for the Companies
However, the Commission has closed its investigation into Apple’s user choice obligations, acknowledging Apple’s proactive efforts to comply with the DMA.
Similarly, Meta’s online intermediation service, Facebook Marketplace, will no longer be “designated” under the DMA. This refers to a status assigned to large digital platforms that function as gatekeepers. Gatekeepers exert significant control over access to digital markets, influencing how other businesses and consumers interact and transact within their ecosystem.
The designation is based on criteria set by the DMA, including the size, market impact, and user base of the platform. Platforms that meet these criteria are subjected to additional regulatory scrutiny and obligations designed to prevent anti-competitive practices and ensure a fair digital marketplace.
For example, a designated platform might be required to allow app developers to inform customers about alternative offers outside of the platform or to provide users with a choice regarding the use of their personal data for targeted advertising.
In the context of the recent decisions by the European Commission, Meta’s Facebook Marketplace was initially designated under the DMA. However, after Meta’s successful argument and measures proving less business-to-consumer use, this designation was reconsidered and ultimately removed, reflecting the platform’s reduced impact on the market.
The implication of this designation is significant. It subjects these platforms to rigorous compliance requirements and ongoing monitoring to promote competition, innovation, and consumer rights. Failing to meet these requirements can result in substantial fines and corrective actions..
