The European Commission has fined Meta €200 million for breaching the Digital Markets Act.
Under the Digital Markets Act, gatekeepers must seek users’ consent for combining their personal data between services. Those users who do not consent must have access to a less personalised but equivalent alternative.
In November 2023, Meta introduced a binary “Consent or Pay” advertising model. Under this model, EU users of Facebook and Instagram had a choice between consenting to the use of their personal data for personalised advertising or paying a monthly subscription for an ad-free service.
The Commission found that this did not comply with the DMA, as it did not give users the required specific choice to opt for a service that uses less of their personal data but is otherwise equivalent to the ‘personalised ads’ service. In addition, Meta’s model did not allow users to exercise their right to freely consent to the combination of their personal data.
In November 2024, after numerous exchanges with the Commission, Meta introduced another version of the free personalised ads model, offering a new option that Meta says uses less personal data to display advertisements. The Commission is currently assessing this new option and continues its dialogue with Meta, requesting the company to provide evidence of the impact that this new ads model has in practice.
Without prejudice to this ongoing assessment, the Commission’s latest decision finding non-compliance concerns the time period during which end users in the EU were only offered the binary ‘Consent or Pay’ option between March 2024, when the DMA obligations became legally binding, and November 2024, when Meta’s new ads model was introduced.
The fine imposed on Meta also considers the gravity and duration of the non-compliance, while noting that this is one of the first non-compliance decisions adopted under the DMA.
In better news for Meta, the Commission also found that Meta’s online intermediation service Facebook Marketplace should no longer be designated under the DMA. The decision follows a request submitted by Meta on 5 March 2024 to reconsider the designation of Marketplace. Following a careful assessment of Meta’s arguments and because of Meta’s additional enforcement and continued monitoring measures to counteract the business-to-consumer use of Marketplace, the Commission found that Marketplace had less than 10,000 business users in 2024. Meta therefore no longer meets the relevant threshold giving rise to a presumption that Marketplace is an important gateway for business users to reach end users.
According to the German news outlet Tageschau, Joel Kaplan, Chief Global Affairs Officer at Meta has claimed that the European Commission wants to hinder successful US firms. In addition, he said that it would cost Meta a billion dollars to change its business model and in so doing would provide a worse service to its customers. The Commission’s decision to levy a fine while it is still reviewing Meta’s revised model has also excited some comment.
