Should ‘gatekeepers’ fail to follow the newly proposed Digital Market Act (DMA), the EU could fine them 10% of a company’s worldwide turnover or 20% for a repeated infringement.
Amazon.com Inc (NASDAQ:AMZN), Apple Inc (NASDAQ:AAPL), Meta Platforms Inc (NASDAQ:FB), Microsoft Corporation (NASDAQ:MSFT) and Google notified the European Commission on Tuesday that they all qualify as ‘gatekeepers’.
Apple generated around US$395bln in 2022, meaning fines could fetch as much as US$78bln for a repeat violation.
Even a first-time charge of US$39.4bln would be three times greater than the current record for a corporate fine, which was US$13bn paid by JP Morgan, according to the moneyhub.
Other potential punishments include periodic penalty payments of up to 5% of daily turnover.
As a last resort, the EU will be able to introduce structural changes like the divestiture of parts of the business.
What is the DMA?
The DMA is being implemented to ensure that services offered by ‘gatekeepers’ remain fair to businesses that operate on them.
It will also give innovators and tech start-ups a better chance to develop projects online without having to agree to “unfair terms and conditions”.
“[Gatekeepers] will simply not be allowed to use unfair practices towards the business users and customers that depend on them to gain an undue advantage,” the European Commission’s website stated.
Under the act, gatekeepers will have to allow third parties more access, provide businesses with data they generate, and offer advertising firms better tools to review the impact of promotions.