The European Commission has issued a stern warning to Meta Platforms, citing violations of the Digital Markets Act (DMA). The warning comes alongside a €200 million fine for non-compliance, as the EU intensifies its efforts to regulate Big Tech and ensure fair competition in the digital economy.
What Is the Digital Markets Act (DMA)?
The Digital Markets Act is a landmark EU legislation designed to curb anti-competitive behavior by tech giants that act as digital “gatekeepers”—companies with significant influence over online platforms and services. The DMA aims to foster a fairer digital market by increasing transparency, user choice, and competition, especially for smaller businesses.
Why Meta Is in Trouble: The Pay-or-Consent Model
Meta introduced a controversial pay-or-consent model in November 2023. Under this system, users could either:
- Use Facebook and Instagram for free with targeted ads (by consenting to data tracking), or
- Pay for an ad-free experience, thus declining data tracking.
The Commission has flagged this model as non-compliant with the DMA, arguing that genuine user consent cannot be considered freely given if it is tied to a financial burden. Meta made partial adjustments in November 2024, but the Commission says these changes still fall short of DMA standards.
Potential Penalties for Continued Violations
The Commission has warned Meta that continued non-compliance could result in daily fines of up to 5% of its average daily global revenue. These penalties are part of the EU’s strategy to enforce accountability and discourage repeated breaches by dominant digital platforms.
Meta’s Defense
Meta has publicly defended its approach, arguing that its model offers users a clear choice and is aligned with existing EU privacy rules. The company claims that other firms use similar models without penalty and alleges that the Commission is unfairly targeting Meta. It also insists that the level of control given to users exceeds regulatory expectations.
EU Commission Responds
In response, the Commission reaffirmed that the DMA is applied equally to all qualifying gatekeepers, regardless of their origin or market position. It emphasized that enforcement decisions are based strictly on compliance, and the goal is to protect consumer rights and preserve fair competition across the EU.
What’s Next?
The Commission will continue to monitor Meta’s compliance closely. A final decision on whether Meta’s revised model meets DMA standards is expected by June 2025. Failure to fully comply by the deadline could trigger further regulatory action and increased financial penalties.