Following the European Union's Digital Markets Act (DMA) decisions that resulted in significant fines for major tech companies, Apple and Meta, a response has come from the Information Technology and Innovation Foundation (ITIF). This prominent think tank for science and technology policy has raised concerns about the implications of these actions on transatlantic relations.
Joseph V. Coniglio, ITIF's director of antitrust and innovation, stated, "With these fines, the European Commission is effectively crossing the Rubicon. Rather than enforce the DMA in a way that appreciates the good faith compliance efforts of American companies and the need for a strong transatlantic partnership, it has made clear that the DMA will be used to extract revenues from U.S. firms even as they continue striving to comply with its strictures."
The Commission's decisions may strain relations with the Trump administration, which views the DMA as potentially unfair to American innovation. Coniglio highlighted that using the DMA as a non-tariff barrier could complicate achieving a comprehensive U.S.-EU agreement.
While ITIF acknowledges the closure of the investigation into Apple's browser choice screen, Coniglio criticized the fine related to Apple’s “anti-steering” policies, which manages how apps can use alternative payment systems. He asserted that dismantling Apple’s business model overlooks its measures to allow different payment providers and the associated privacy and security benefits for European users.
Similarly, while the removal of Facebook Marketplace from DMA scrutiny is recognized, ITIF opposes the fine on Meta's “consent or pay” model. According to Coniglio, this amounts to "de facto public utility regulation of the worst kind," affecting how Meta prices its products without enhancing competition. He noted that the ongoing assessment of Meta's new ad model indicates U.S. firms are negotiating under pressure, not in good faith.
The U.S.-Italy Joint Leaders Statement recently emphasized the significance of fair information technology regulation, expressing concern over what is viewed as heavy-handed policies targeting American companies. The statement warns that this approach could inadvertently empower China in its global technological ambitions.
Contact: Sydney Mack, [email protected]