The European Commission (EC) has initiated action against Meta’s contentious plan to charge a subscription fee to users who prioritize privacy on its platforms. Rather than leveraging frameworks like the Digital Services Act (DSA), the Digital Markets Act (DMA), or the General Data Protection Regulation (GDPR), the EC announced on Monday that Meta risks sanctions under EU consumer laws if it fails to address major issues with its “pay or consent” model.
Meta’s approach requires users to either subscribe to Facebook and Instagram for a fee or consent to the use of their personal data for personalized advertisements. The EC argues that the short notice given to users exposed them to undue pressure, fearing they might lose access to their accounts and contacts. This practice, according to the EC, is misleading, as it wrongly implies that opting for ad-based plans is entirely free, ignoring the cost of personal data exploitation.
Didier Reynders, the EC’s commissioner for justice, emphasized the need for transparency, stating: “Consumers must not be lured into believing that they would either pay and not be shown any ads anymore, or receive a service for free, when, instead, they would agree that the company used their personal data to make revenue with ads.” Reynders highlighted that EU consumer protection law mandates that traders provide clear information upfront regarding personal data usage.
To protect consumers, the EC has collaborated with national consumer protection bodies, issuing a letter to Meta demanding solutions to the identified issues by September 1. Potential remedies include giving users more time to make informed decisions or fundamentally altering the language and interface employed to collect user consent.
Despite ongoing scrutiny, Meta defends its model as compliant with European regulations, citing endorsement from the Court of Justice of the European Union (CJEU). However, privacy advocates caution that this supposed endorsement was hypothetical. The EC remains unconvinced, particularly since Meta’s sudden consent model changes for current users could be perceived as misleading and coercive.
Failure to address the EC’s concerns could result in significant fines for Meta under the EU’s Unfair Contract Terms Directive. The EC’s vice president for values and transparency, Věra Jourová, labeled Meta’s approach as “sneaky,” affirming the EU’s commitment to safeguarding consumer rights and informed choice.