EU Expected to Impose Billion-Dollar Fine on Meta Over Antitrust Issues
Potential Showdown with Trump Amidst “Extortion” Claims
The European Union is poised to levy a substantial fine, potentially reaching $1 billion or more, against Meta, Mark Zuckerberg’s tech giant, for alleged breaches of its stringent competition regulations, sources have informed The Post. This action sets the stage for a possible confrontation with former President Trump, who has previously likened EU penalties to “overseas extortion.”
EU Antitrust Probe to Conclude Soon
The European Commission, the EU’s antitrust regulator, is anticipated to determine that Meta is not in compliance with the Digital Markets Act (DMA), according to individuals familiar with the matter who spoke to The Post on Monday.
Digital Markets Act and “Gatekeeper” Designation
The landmark DMA, which came into force in 2023, imposes strict competitive regulations on Meta and six other companies designated as digital “gatekeepers.” These include:
- Alphabet (Google’s parent company)
- Amazon
- Apple
- Booking.com
- ByteDance (TikTok’s parent company)
- Microsoft
EU regulators and proponents of the law assert that it prevents major tech corporations from suppressing smaller competitors through anti-competitive practices.
Sources indicate that the anticipated fine is expected to be in the hundreds of millions of dollars, with the potential to surpass $1 billion.
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The EU’s investigation into Meta, the parent company of Facebook and Instagram, is projected to conclude as early as this week. An announcement regarding the commission’s enforcement action is expected to follow immediately, insiders added.
Anticipated Fine and “Cease-and-Desist” Notice
EU officials are also expected to issue Meta a “cease-and-desist” order, essentially informing the company of the necessary changes to achieve compliance, sources revealed.
Spokespersons for Meta and the European Commission did not immediately respond to requests for comment.
Apple Also in EU’s Sights
Apple is also under EU scrutiny, and a potential fine against the iPhone maker could be announced either this week or the following week, sources stated.
Earlier this month, Reuters reported that both Apple and Meta were likely to face “modest fines” for DMA breaches. EU antitrust chief Teresa Ribera previously indicated that a decision on enforcement actions for both companies was forthcoming in March.
DMA Fines and Repeat Offenses
Under the Digital Markets Act, major technology companies can be fined up to 10% of their global revenue for violations. This penalty can escalate to 20% of global revenue for repeated infringements.
Meta’s “Pay or Consent” Subscription Service
Last July, the EU issued preliminary accusations against Meta, alleging DMA violations for compelling users into a restrictive “pay or consent” model for advertisements on Instagram and Facebook.
Officials focused on Meta’s 2023 rollout of a subscription service. This service allowed users to pay approximately $14 per month for an ad-free experience on the platforms or to consent to Meta utilizing their personal data for personalized advertising.
EU Commission’s Concerns
“This binary choice forces users to consent to the combination of their personal data and fails to provide them a less personalized but equivalent version of Meta’s social networks,” the European Commission stated at the time.
In a public compliance report issued earlier this month, Meta stated it has “continued to receive additional demands that go beyond what is written in the law,” despite its efforts to adhere to DMA regulations.
In June 2024, Apple became the first company to be charged with DMA breaches for allegedly impeding rival app developers from easily directing customers to services outside of its App Store ecosystem. Reports emerged in November suggesting that Apple was likely to be fined.
The EU took further action last week, cautioning Apple to open its iPhone operating system to app developers. It also informed Alphabet that it might face fines for prioritizing its own internal services over rivals within its search results.
Techlash and Trump’s Retaliation Threats
Aside from facing criticism from Big Tech companies, the DMA has increasingly drawn the ire of former President Trump. Trump has accused Europe of exploiting the US and pledged to impose retaliatory tariffs to create a level playing field.
Trump issued a memo last month warning that his administration would “consider responsive actions like tariffs to combat the digital service taxes (DSTs), fines, practices, and policies that foreign governments levy on American companies.”
“President Trump will not allow foreign governments to appropriate America’s tax base for their own benefit,” the White House stated at the time.
Jordan’s Inquiry and Zuckerberg’s Defense of US Tech
Separately, House Judiciary Committee Chair Jim Jordan requested a briefing from EU officials concerning the bloc’s plans to enforce the Digital Markets Act. Jordan noted that six of the seven “gatekeepers” subject to the law are American-owned.
“These severe fines appear to have two goals: to compel businesses to follow European standards worldwide, and as a European tax on American companies,” Jordan stated in a letter.
Zuckerberg, who has aligned himself with Trump since his election victory, has commented that the EU fines targeting Big Tech are “almost like a tariff” and have become “sort of like an EU-wide policy for how they want to deal with American tech.”
During an appearance on “The Joe Rogan Experience” podcast in January, Zuckerberg argued that Trump should challenge these penalties.
“I think it’s a strategic advantage for the United States that we have a lot of the strongest companies in the world, and I think it should be part of the US strategy going forward to defend that,” Zuckerberg said.
Long History of EU-Meta Data Privacy Clashes
The EU and Meta have a long-standing dispute concerning data privacy, including a record fine of $1.3 billion in 2023 for improperly transferring European users’ data to the US.