EU warns: If Meta's "pay or agree" model adjustments do not meet standards, it may face daily fines

According to Zhitong Finance APP, the European Union has warned that if EU regulators believe that Meta (META.US) has not made adjustments to its controversial "pay or consent" model that meet EU standards, the company may face daily fines starting later this month. It is reported that Meta's "pay or consent" model refers to users either agreeing to data collection while using Meta's apps for free or paying to not share their data. This service was launched on Facebook and Instagram in Europe in 2023. The European Commission has accused this binary choice approach of forcing users to combine their personal data and not providing them with a social networking service that has fewer personalized ads but consistent functionality. Two months ago, the European Commission imposed a fine of €200 million (approximately $234 million) on Meta for violating the Digital Markets Act (DMA), which aims to curb the power of large tech companies. Daily fines for non-compliance with DMA regulations can reach up to 5% of a company's global daily revenue. Although Meta adjusted the model in 2024 to limit the use of personal data, EU regulators still do not believe these changes are sufficient. A spokesperson stated, "The European Commission is currently unable to confirm whether these measures are adequate to meet the main compliance parameters outlined in its non-compliance decision." Reports indicate that the European Commission is considering next steps and reiterated that "continued non-compliance may lead to regular fines starting from June 27, 2025." Meta has accused the European Commission of "constantly changing the rules" and discriminating against it during discussions over the past two months. A spokesperson for the company stated, "The choice between an ad-free subscription service and a free service with ads should be a legitimate business model that every company can adopt in Europe—except for Meta." "We are confident that the range of choices we offer users in the EU not only meets the requirements of EU rules but even exceeds them." In response to Meta's allegations of "discrimination," EU regulators dismissed the claims, stating that the DMA applies to all large digital companies operating in the EU, regardless of their registration location or controlling shareholders. A spokesperson for the European Commission stated, "We consistently enforce the law fairly and will continue to regulate all companies operating in the EU without discrimination under the global regulatory framework."