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A „symbolic” fine of half a billion euros
While the European Commission’s penalties against Apple and Meta were expected, the comparatively modest size of the fines appears to be influenced by the current state of transatlantic relations, stated Aleksandra Wójtowicz, a digital analyst at the Polish Institute of International Affairs (PISM).
The European Commission’s decision to levy fines on Apple and Meta stems from an investigation that has been in progress since 2023. – Despite the lengthy duration of this process, the fine amounts were shaped by the prevailing international context. There have been indications for quite some time that the penalties would not significantly affect these companies’ finances, a notion confirmed in the final ruling – remarked Wójtowicz.
„Symbolic penalty”
– The fine set for Apple is €500 million, while Meta faces a €200 million penalty. Though these figures may seem considerable, they actually represent only about 0.15% of each company’s global revenue projected for 2024. This is considerably less than the maximum 10% that the European Commission could levy under the Digital Markets Act (DMA). Within this framework, it is more accurately described as a symbolic penalty rather than a substantial punishment – the expert highlighted.
– Even with the modest size of these fines, this ruling carries significant political and regulatory implications. It illustrates the European Commission’s commitment to enforcing new digital regulations and indicates that similar measures could extend to other corporations, such as Alphabet. The fines could be escalated if these companies do not adhere to the Commission’s recommendations, paving the way for more assertive actions in the future – Wójtowicz opined.
The ruling has already sparked reactions from the United States. „A public affairs representative from Meta in the US labeled the actions from Brussels a „quasi-tax” or even „quasi-customs,” fitting into the broader narrative of Washington’s increasing skepticism about European regulations. This could signal a potential escalation in the ongoing dispute between the EU and the US over digital matters,” the analyst observed.
In this light, the expert posits a question regarding the implications of this ruling for discussions about the European digital tax. – It is likely that the Commission’s decision may bolster calls for an independent EU strategy for taxing tech giants. The discourse surrounding the necessity for these corporations to contribute to the funding of European public services might gain momentum – Wójtowicz assessed.
Nevertheless, as noted by the PISM analyst, „it appears that the current penalties will not directly catalyze changes in this discussion.” – The fines are too minimal and the limited media attention surrounding this decision means it lacks the potential to significantly alter the positions of member states. Had the penalties been more severe, they might have more effectively stimulated conversations regarding the future of taxing big tech within the EU – the PAP interviewee commented.
Penalties for tech giants
On Wednesday, the European Commission enacted its initial financial penalties under the Digital Markets Act (DMA), imposing a €500 million fine on Apple and a €200 million fine on Meta, the parent company of Facebook and Instagram, for violating rules aimed at ensuring fair competition in the EU’s digital marketplace.
The Commission penalized Apple for obstructing app developers from promoting their products outside of the company’s App Store, and Meta was fined for restricting users’ freedom to choose whether to share their personal data with advertisers.
EU officials have firmly dismissed any claims that these penalty decisions are linked to trade discussions with the U.S. They emphasized that enforcement and trade policy are distinct matters and that DMA regulations will be applicable to all companies, irrespective of their country of origin.
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