Meta vs EU: Daily fines loom over ad consent clash

Meta Platforms is on the brink of incurring daily fines from European Union regulators, who are scrutinizing whether the tech giant's proposed changes to its "pay-or-consent" model adequately comply with a critical antitrust order. This warning from the European Commission, the EU's competition enforcer, signals a continued crackdown on Big Tech's market dominance, as per reports.

The Commission's latest move comes just two months after it slapped Meta with a €200 million ($234 million) fine for breaching the Digital Markets Act (DMA). The DMA is a landmark piece of legislation designed to curb the power of large digital companies and foster a level playing field for smaller rivals, a push that has drawn criticism from the U.S. for seemingly targeting its tech giants.

The Heart of the Dispute: Meta's "Pay-or-Consent" Model

At the core of the dispute is Meta's "pay-or-consent" model, introduced in November 2023 for Facebook and Instagram users. This model offers users a choice: either consent to be tracked for targeted advertising to receive a free, ad-supported service, or pay for an ad-free experience.

The EU executive had previously determined that this model, in its original form, violated the DMA up until November 2024, when Meta made adjustments to use less personal data for advertising. However, the Commission has been scrutinizing these tweaks and now indicates that the proposed changes are "limited."

A spokesperson for the Commission stated, "The Commission cannot confirm at this stage if these are sufficient to comply with the main parameters of compliance outlined in its non-compliance Decision." The spokesperson further warned that "continuous non-compliance could entail the application of periodic penalty payments running as of June 27, 2025."

Escalating Tensions and Accusations

Should Meta fail to comply, the daily fines could be substantial, reaching as much as 5% of the company's average daily worldwide turnover.

Meta, however, has pushed back vehemently, accusing the Commission of discrimination and "moving the goalposts" during recent discussions. A Meta spokesperson asserted, "A user choice between a subscription for no ads service or a free ad supported service remains a legitimate business model for every company in Europe - except Meta." They added, "We are confident that the range of choices we offer people in the EU doesn't just comply with what the EU's rules require - it goes well beyond them."

The EU watchdog swiftly dismissed Meta's accusations of discrimination, emphasizing that the DMA applies equally to all large digital companies operating within the EU, regardless of their incorporation location or controlling shareholders. "We have always enforced and will continue to enforce our laws fairly and without discrimination towards all companies operating in the EU, in full compliance with global rules," the Commission spokesperson affirmed, as per reports.

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