Description: The European Commission, EU’s executive branch, has fined American companies Apple and Meta $571 million and $227 million respectively regarding violations with EU’s Digital Markets Act (DMA). The Commission uncovered that Meta has violated privacy and advertising regulations, forcing users to pay for the exclusion of ads or consent towards privacy access that was discovered to have been contrary to the regulations. Apple on the other hand was found guilty of abusing their market position blocking smaller developers and companies through the App Store from presenting customers with cost – effective options for apps that didn’t pertain to Apple’s digital market portfolio. Many considered the fines to be a symbolic act of reprimand since according to estimates, Apple suffered cuts of 46 hours from their last annual profits of $391 billion while Meta suffered cuts that amounted to 28 hours of their annual profits which amounted to $62.4 billion.
Impact: Big tech companies have ascertained themselves in the center of the global trade war as the EU facing growing threats from Trump’s tariffs have signaled throughout the fines that is planning on holding its ground. Companies such as Meta and Apple dominate the digital markets with EU as one of their largest regions for revenue and profits, however, comparing financial data, the fines in reality represent a short warning for the Trump administration to bring traditional trade flows with the EU bloc on an even keel. The actions by the European Commission outline the short to mid – term strategy the EU plans on implementing which encompasses constraining American companies of access to the EU market and carving out large portions of economic codependence with the US. Trump has announced he plans on decreasing the tariffs on multiple countries with no concrete measures presented, which puts larger economic partners such as the EU still on the fence in approaching direct trade negotiations.