Meta Platforms (NASDAQ:META) is once again under pressure from European regulators, who have warned that the company could face daily fines starting June 27 if it fails to align its ad practices with the European Union’s Digital Markets Act (DMA), Reuters reported Friday.
The dispute centers around Meta’s “pay-or-consent” model introduced in late 2023. Under this system, users on Facebook and Instagram can either accept data tracking for personalized ads or pay a monthly fee to avoid it. Though Meta updated the model in early 2024 to reduce the scope of personal data used, EU officials say those changes might still fall short of legal requirements.
A European Commission spokesperson told Reuters that it is still unclear whether Meta’s latest adjustments meet compliance expectations, noting that an official decision on next steps is pending. However, the Commission warned that continued non-compliance could trigger periodic penalties, potentially amounting to as much as 5% of Meta’s average daily global revenue.
This isn’t Meta’s first brush with EU penalties. Just two months ago, the tech firm was hit with a €200 million ($234 million) fine for earlier violations of the DMA, which seeks to limit the power of dominant digital platforms and safeguard user rights in the European market.
In response, Meta has pushed back against the regulatory scrutiny. According to a separate Reuters report, the company accused the EU of shifting compliance expectations and targeting its business model unfairly. Meta argued that it has cooperated with regulators and invested significantly in modifying its approach to meet the Commission’s standards.
The showdown signals rising tensions between Silicon Valley giants and European authorities, who are increasingly assertive in their efforts to rein in digital platforms and enforce user privacy protections.