FX.co ★ EU Accuses Meta Of Breaching Digital Laws With New 'Pay Or Consent' Model

The European Commission has charged Meta Platforms Inc. (META) with violating the EU's new digital regulations by implementing an advertising model that requires users to pay for ad-free access to Facebook and Instagram.

On Monday, the Commission revealed its preliminary findings, indicating that Meta's "pay or consent" advertising model contravenes the Digital Markets Act (DMA).

Last year, Meta introduced this model to comply with the EU's data privacy laws. It allows users to either pay a monthly fee to enjoy Facebook and Instagram without ads—thus ensuring their data isn't used for advertising—or opt out of paying and have their data utilized for personalized advertisements.

However, the Commission's preliminary assessment suggests that this binary choice effectively coerces users into consenting to the merging of their data, failing to offer a sufficiently equivalent alternative that is less personalized.

According to the Commission, Meta's "pay or consent" model does not adhere to the DMA because it fails to provide a comparable level of service that relies less on personal data. Moreover, it does not enable users to freely consent to the data combination.

To align with the DMA, the Commission asserted that Meta must allow users who do not consent to data usage the option of an equivalent service that relies on less of their data.

By issuing these preliminary findings, the Commission has notified Meta of its initial stance that the company is in violation of the DMA. This step is taken without prejudice to the final outcome of the investigation. Meta now has the opportunity to defend itself by reviewing the investigation documents and responding in writing to the Commission's preliminary conclusions.

"Our investigation aims to ensure fair competition in markets where gatekeepers like Meta have been amassing personal data from millions of EU citizens over many years. Our preliminary view is that Meta's advertising model is not compliant with the Digital Markets Act. We aim to empower citizens to control their data and opt for a less personalized ad experience," stated Margrethe Vestager, Executive Vice-President responsible for competition policy.