DMA fines on Meta and Apple spark transatlantic tech tensions: Regulation or retaliation?

April 25, 2025 10:51 AM

In a bold and polarising move, the European Commission this week handed down its first major penalties under the Digital Markets Act (DMA), fining Apple €500 million and Meta €200 million for failing to meet newly codified standards for competition and user privacy in the EU.

But the reaction from Washington was swift and fierce. The White House blasted the EU’s actions as a “novel form of economic extortion” — a statement that underscores growing regulatory and geopolitical fault lines in global tech governance.

For Jeff Le, managing principal at 100 Mile Strategies and visiting fellow at George Mason University’s National Security Institute, the deeper issue is whether this is protectionism or simply long-overdue regulation.

“EU citizens have consistently raised concerns about their own data governance and tech sovereignty,” said the former deputy cabinet secretary for the State of California.

“The DMA is a prescriptive and, at times, painful process. But regulators and legislators have gone through a substantial policymaking process and landed where they are. This is in their domain, even if companies and some users are less favourable to the outcomes.”

The fines are no mere slaps on the wrist. Apple was punished for failing to let app developers steer users to alternative purchase options outside its tightly controlled App Store.

Meta, meanwhile, was sanctioned for implementing a "consent or pay" model that forced users to choose between surrendering personal data or paying a subscription fee for an ad-free experience — a move the Commission ruled breached consent standards and consumer choice obligations under the DMA.

“Whether the Trump administration will choose to impose additional tariffs on the EU is open to question,” said Jonathan Compton, compliance expert and partner at DMH Stallard. “For its part, the Commission has not backed away from the fight so far and has the market power to counter US moves.”

While the tech firms themselves have pushed back — with Meta arguing its business model is lawful and Apple claiming its approach supports innovation and user safety — the broader implications are increasingly being viewed through the lens of geopolitics.

The European Commission’s action, according to Le, reflects a deliberate attempt to rebalance power in the digital ecosystem.

“This isn’t economic extortion,” he argues. “American tech companies should be able to operate in the EU, and these actions were initiated well before the Trump administration’s second term. The compliance has been painful and slow, but that’s the barrier to entry.”

Challenging big tech

Indeed, the Commission has a track record of challenging Big Tech long before the DMA came into force. Google, Meta, and Amazon have all faced multi-billion-euro fines in recent years, mostly tied to privacy or competition violations.

What’s different now is the emergence of regulatory frameworks like the DMA — and the looming EU AI Act — that aim to structure how dominant firms operate in Europe’s digital market.

Henna Virkkunen, MEP and executive vice president for tech sovereignty and democracy, reinforced the Commission’s stance in a statement: “Enabling free business and consumer choice is at the core of the rules laid down in the Digital Markets Act. This includes ensuring that citizens have full control over when and how their data is used online.”

The DMA, which applies to so-called “gatekeepers” — large digital platforms with entrenched market dominance — mandates interoperability, data portability, and stricter consent standards. While hailed by EU regulators as a win for innovation and competition, U.S. officials and some industry leaders view it as protectionist and asymmetrical.

Le warns that escalating this issue into a trade dispute could play directly into the hands of global adversaries.

“If hostilities escalate, both the United States and EU will lose. China and other adversaries benefit from a divided EU and United States.”

He adds that instead of retaliatory tariffs, the U.S. should take this moment to develop a coherent domestic technology and consumer protection strategy:

“The White House and Congress have the opportunity to put forward a comprehensive emerging technology agenda. The absence of national laws here and a growing regulatory gap between the U.S. and EU presents real governance challenges.”

With bipartisan interest already emerging around federal privacy laws and digital protections, Le sees an opening to harmonise standards before the divide becomes a chasm.

The timing of these fines — coinciding with the run-up to critical compliance deadlines for the DMA in June — ensures that tensions will remain high. While it is unclear whether the Trump administration will translate rhetoric into tariffs, the language suggests tech regulation may soon be entangled with larger trade policy battles.