Apple is on the verge of becoming the first company to be fined under the European Union’s groundbreaking Digital Markets Act (DMA), a set of new regulations designed to curb the dominance of Big Tech and promote fairer competition. Sources familiar with the matter revealed that EU regulators are preparing to impose the penalty after the tech giant allegedly failed to comply with requirements to allow app developers more freedom to direct users to cheaper offers outside of Apple’s App Store.
This penalty would mark the first enforcement of the DMA against a major tech player. Apple has reportedly violated the law by not giving developers the ability to inform users about alternative, more affordable options for digital purchases that do not go through the App Store’s payment system.
The fine is expected to be handed down in the coming weeks, although some reports suggest that its timing could shift. The upcoming penalty adds to Apple’s already significant antitrust woes in Europe, following a €1.8 billion fine earlier this year for similar practices concerning its App Store’s impact on competitors, notably the music streaming service Spotify.
The DMA, which came into effect earlier this year, was specifically designed to address the unbalanced power dynamics between large platforms like Apple, Google, and others, and smaller tech companies. Under the DMA, Apple is required to make significant changes to its business practices, such as allowing users to choose default web browsers on iPads, permitting third-party app stores on iOS devices, and granting peripheral devices like headphones and smart pens better access to Apple’s ecosystem.
Apple’s troubles in Europe don’t end with the upcoming fine. The company is also under investigation for its recent imposition of new fees on app developers, which could lead to further penalties. Under the DMA, fines for non-compliance can reach up to 10% of a company’s global annual turnover, a potentially massive amount for a company of Apple’s size.
The EU’s scrutiny of Apple also comes on the heels of a major loss for the company in its long-running tax dispute with the European Commission. In September, Apple was ordered to pay €13 billion in back taxes to Ireland, a decision that has added fuel to the fire of the company’s regulatory battles in the region.
As the European Commission prepares to act, this fine is a clear signal that the EU is serious about using the DMA to rein in the unchecked power of tech giants and ensure a more level playing field for smaller competitors. Apple has yet to comment on the reports, and the European Commission has not provided an official statement on the matter.
For now, the looming fine serves as a reminder of the increasing regulatory pressure facing major tech companies around the world as governments seek to rein in their influence in digital markets. Apple, meanwhile, will likely continue to face heightened scrutiny from regulators as the EU’s digital antitrust rules take effect across the continent.