Data usage notification: either make a payment of €7.99 or agree to allow your data to be utilized for targeted advertisements tailored to your preferences
Meta, the parent company of Facebook and Instagram, has introduced a new business model known as the "Pay or Permit" (or "Consent or Pay") model. This model requires users to either pay a monthly subscription fee for using the platforms without personalised ads based on their data, or consent to Meta using their personal data for advertising and other purposes.
However, this model has raised significant legal and regulatory challenges in the European Union, particularly concerning compliance with the Digital Services Act (DSA), Digital Markets Act (DMA), and General Data Protection Regulation (GDPR).
The European Commission (EC) has found Meta's "Consent or Pay" approach non-compliant with EU laws. In April 2025, Meta was fined €200 million for failing to uphold consumer data privacy obligations under the EU framework, particularly violating the Digital Markets Act and data protection principles that require consent to be freely given.
The EC has warned Meta that if it does not adjust the model to meet legal standards, it faces potential daily fines. These fines reflect ongoing scrutiny aimed at ensuring that consent is genuine and not coerced by the threat of losing access to services without paying.
The model also implicates broader antitrust concerns under EU competition law. Meta's previous fines include tying services like Facebook Marketplace to the Facebook social network in contravention of antitrust rules.
A key legal tension revolves around whether "pay or permit" mechanisms violate the GDPR's requirement for freely given consent. Critics argue that such models force users to accept invasive tracking or pay up, undermining the principle that consent must be voluntary and informed.
The DSA aims to increase transparency and accountability of large online platforms. Meta's model interacts with these goals by raising questions about user autonomy and transparency regarding data use. Compliance with the DSA, GDPR, and DMA requires platforms to avoid gatekeeping practices that limit fair user choice or violate data protection principles.
Meta's "Pay or Permit" model is seen as problematic because it restricts users' ability to access the platforms both without paying and without giving controversial consent to data use. The EC and other regulators are pressing Meta to change their model to allow users real choice without coercion. Failure to conform may lead to escalating fines, increased regulatory scrutiny, and significant reputational damage.
In conclusion, Meta's "Pay or Permit" model for Instagram and Facebook is currently non-compliant with key EU digital regulations, especially concerning user consent and competitive fairness. The EU is enforcing penalties and demanding adjustments to align with the DSA and related laws. If unresolved, Meta faces substantial fines and regulatory action aimed at protecting digital user rights and contestability within the EU’s single market.
In light of the EU's Digital Services Act (DSA) and Digital Markets Act (DMA), the European Commission (EC) has found Meta's new "Pay or Permit" model non-compliant, resulting in a €200 million fine due to violations of data protection principles. The EC continues to scrutinize Meta's model, emphasizing that consent must be genuinely given and not coerced by the threat of losing access to services.
This "Pay or Permit" approach raises antitrust concerns under EU competition law, as it may limit fair user choice and violate data protection principles, leading to potential escalating fines and increased regulatory scrutiny if Meta fails to adjust the model accordingly.
