The European Union issued a warning to Apple on Monday, stating that its App Store is breaching digital competition rules, potentially subjecting the iPhone maker to billions of dollars in fines.
This is the latest development in a protracted battle between Brussels and major tech firms, addressing issues ranging from data privacy to disinformation.
Stifling Competition
Brussels has imposed over €10 billion in fines on tech companies for abusing their dominant market positions. The recent threat to Apple follows a €1.8 billion ($1.9 billion) penalty three months ago for restricting European users from accessing cheaper music streaming services.
Among major tech firms, only Google has faced a larger single antitrust fine, exceeding €4 billion in 2018 for leveraging its Android operating system to promote its search engine. Google has also incurred billion-euro-plus fines for abuses in online shopping and advertising sectors.
Last year, the European Commission recommended that Google sell parts of its business, warning of a potential fine up to 10% of its global revenue for non-compliance.
Privacy
Ireland enforces the strictest data privacy fines, with local regulators overseeing the laws. Dublin, hosting the European offices of many big tech firms, saw its regulator penalize TikTok €345 million for mishandling children’s data last September, following a record €1.2 billion fine to Meta for illegal data transfers between Europe and the United States.
Previously, Luxembourg held the record for data fines, imposing a €746 million penalty on Amazon in 2021.
Taxation
The EU has struggled to compel tech companies to pay more taxes in Europe, where they are accused of funneling profits into low-tax jurisdictions like Ireland and Luxembourg. Notably, in 2016, the European Commission ordered Apple to pay Ireland €13 billion in back taxes, deeming a favorable deal with the government illegal. However, EU judges overturned the decision, a ruling the commission continues to challenge.
Similarly, the commission is appealing a court decision that overruled its order for Amazon to repay €250 million in back taxes to Luxembourg.
Disinformation and Hate Speech
Web platforms have long been criticized for failing to address hate speech, disinformation, and piracy. The EU’s Digital Services Act (DSA), passed last year, mandates companies to tackle these issues or face fines up to 6% of their global turnover.
The bloc has already begun applying the DSA, opening investigations into Facebook and Instagram for not addressing election-related disinformation. Additionally, the EU has warned Microsoft that falsehoods generated by its AI search could violate the DSA.
Paying for News
Google and other online platforms have been accused of profiting from news without compensating content creators. To address this, the EU introduced “neighboring rights” allowing print media to demand payment for their content. France has tested these rules, and after initial resistance, Google and Facebook agreed to pay some French media for articles shown in web searches.
