Meta Faces EU Fines Over Pay-or-Consent Model Non-Compliance

Meta Platforms has accused EU antitrust regulators of unfairly targeting its pay-or-consent business model, claiming that the European Commission has changed the rules midway through their compliance efforts. The US tech giant asserts that it has been engaging in constructive dialogue and implementing substantial changes to meet the EU's regulations. A Meta spokesperson highlighted that the variety of options provided to EU users not only meets but exceeds the EU’s regulations.

EU regulators have warned that they may impose daily fines on Meta Platforms if the changes proposed to its pay-or-consent model do not comply with an antitrust order issued in April. This warning comes two months after the European Commission fined the US social media giant 200 million euros, worth $234 million, for violating the Digital Markets Act (DMA). The DMA is designed to limit the influence of major technology companies.

According to the Commission, Meta’s original pay-or-consent model, launched in November 2023, breached the DMA by relying heavily on personal data for targeted ads. Although the company modified the model in November 2024 to reduce data usage, regulators are still assessing whether those changes are sufficient. The model offers Facebook and Instagram users a free service in exchange for agreeing to be tracked, with advertising revenues funding the service. Alternatively, users can pay for a service without ads.

Daily fines for non-compliance with the DMA can amount to up to 5% of a company’s average daily worldwide turnover. This action underscores the Commission’s broader crackdown against Big Tech and its efforts to level the playing field for smaller rivals. The United States has accused the bloc’s rules of being primarily directed against its companies.

The EU competition watchdog has stated that Meta is expected to make only limited changes to its pay-or-consent model. The Commission’s actions towards Meta have raised concerns within the tech ecosystem. Meta has claimed that the Commission is treating them unfairly and changing the requirements during discussions over the past two months. A Meta spokesperson argued that a choice for users between a subscription with no ads or a free service supported by ads is a valid business model for every company in Europe, except for Meta.

In response, the EU watchdog rejected Meta’s discrimination claims, stating that the DMA applies equally to all large digital companies operating in the EU, regardless of their home country or ownership. A commission spokesperson emphasized that the Commission enforces its laws fairly and will continue to do so without bias against any company operating in the EU, fully complying with international regulations. The Commission could not confirm if the measures taken by Meta were sufficient to meet the key compliance standards mentioned in its non-compliance decision.

The spokesperson added that ongoing non-compliance could lead to periodic penalty payments starting from June 27, 2025, as mentioned in the non-compliance decision. This broader crackdown by EU regulators against giant tech firms aims to enforce compliance with the DMA and ensure a fairer digital market for all companies operating within the EU.