The European Commission is facing a series of crucial deadlines to decide whether tech giants Apple, Meta and Google are violating the Digital Markets Act. These decisions come at a politically sensitive moment, with US President Trump threatening retaliatory measures against what he calls ‘overseas extortion’ of American companies.
The timing for the EU to tackle large tech companies could hardly have been worse. As tensions in the global trade war rise, the European Commission must make important decisions about whether American tech giants comply with the Digital Markets Act (DMA).
Deadlines for DMA compliance are fast approaching.
Today, the Commission announced that Apple must open up its products and services to competitors. Functionalities that Apple currently only offers on its own equipment must also be available to competitors. For example, pairing Apple Airpods can be done by simply holding them up to an iPhone, and the competition must soon be able to do the same.
In the upcoming weeks, multiple decisions on investigations will follow into non-compliance with the DMA by Apple, Meta and Google. The Commission has repeatedly promised that decisions will follow quickly, especially for Apple and Meta, following complaints from users such as Epic Games and Spotify, who claim that current compliance efforts are insufficient.
Although we are increasingly getting used to the fact that the European Commission is committed to creating a fair and balanced market, the decisions could cause quite a stir in the current political climate. Every decision against an American tech company will further increase tensions with the US. On the other hand, the European Commission cannot suddenly become lenient either. If they now act softly because of tensions with the United States, it will undermine the purpose of all the regulations that have been introduced in the last few years.
Apple in the EU’s crosshairs
The EU currently has six ongoing cases against Apple, Meta and Google for non-compliance with various parts of the DMA. Although investigations should technically be completed within a year, these timelines are not fixed.
Apple is the main target, with three investigations into non-compliance with the DMA and the Commission’s order to open up its devices to competitors. Next week, the Commission must complete one of the other investigations. This concerns the rules surrounding the Apple app store. App developers claim that the current rules unfairly disadvantage them if they keep customers away from Apple’s payment system and the fees that the company charges developers.
According to two people familiar with the case, Apple will likely face a decision on non-compliance with its anti-steering provisions, which could potentially result in a fine.
Apple will probably not roll over and comply. They have already filed a case against the Digital Markets Act at the European Court of Justice. The company is not alone; Meta and TikTok have also filed complaints about the implementation of the DMA.
Political tensions are mounting
The timing of these decisions is particularly sensitive due to recent criticism from US President Trump. He called the DMA “overseas extortion” of American companies, and the White House has even threatened additional tariffs in response to the EU’s technology regulations.
These tensions are nothing new. As early as 2023, US House of Representatives members asked President Biden to take action against the Digital Markets Act. They argued that European regulations mainly disadvantage American tech companies, while Chinese and European companies remain unscathed.
The European Commission is trying to reduce tensions by emphasizing that its approach is not anti-American. “The DMA does not target American companies,” European Commissioners Teresa Ribera and Henna Virkkunen wrote to an American legislator earlier this month, emphasizing that the EU’s goal “is to ensure compliance, not to impose fines.”
Consequences for the market
In the meantime, hundreds of American and European developers are waiting to see how strictly the Commission will enforce the rules. Some organisations already have products ready to roll out, but are still waiting for clarity on the final changes in the app stores.
The Digital Markets Act is part of a broader European strategy to regulate the digital economy. In 2023, Europe introduced both the Digital Services Act (DSA) and the Digital Markets Act (DMA). Where the DMA focuses on limiting the power of Big Tech for fairer competition, the DSA is more focused on user safety and tackling illegal content.
The EU has built up a reputation as a regulator in the technology sector, with previous initiatives such as the European Chips Act and plans for a Digital Network Act. These regulations are part of the EU’s broader efforts to strengthen its competitiveness and improve its economic performance. Therefore, a soft approach to enforcing the DMA is not an option.