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EU can't confirm if Meta's model changes comply with rules

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Will consider next steps, including daily fines

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Meta accuses EU of discriminating against business model

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Meta says its changes go beyond what EU law requires

(Adds Meta comments paragraphs 10-13, context in paragraph 3,4)

By Foo Yun Chee

BRUSSELS, June 27 (Reuters) - Meta Platforms ( META )

may face daily fines if EU regulators decide the changes it has

proposed to its pay-or-consent model fail to comply with an

antitrust order issued in April, they said on Friday.

The warning from the European Commission, which acts as the

EU competition enforcer, came two months after it slapped a

200-million-euro ($234 million) fine on the U.S. social media

giant for breaching the Digital Markets Act (DMA) aiming at

curbing the power of Big Tech.

The move shows the Commission's continuing crackdown against

Big Tech and its push to create a level playing field for

smaller rivals despite U.S. criticism about the bloc's rules

mainly targeting its companies.

Daily fines for not complying with the DMA can be as much as

5% of a company's average daily worldwide turnover.

The EU executive said Meta's pay-or-consent model introduced

in November 2023 breached the DMA in the period up to November

2024, when it tweaked it to use less personal data for targeted

advertising. The Commission has been scrutinising the changes

since then.

The model gives Facebook and Instagram users who consent to

be tracked a free service that is funded by advertising

revenues. Alternatively, they can pay for an ad-free service.

The EU competition watchdog said Meta will only make limited

changes to its pay-or-consent model rolled out last November.

"The Commission cannot confirm at this stage if these are

sufficient to comply with the main parameters of compliance

outlined in its non-compliance Decision," a spokesperson said.

"With this in mind, we will consider the next steps,

including recalling that continuous non-compliance could entail

the application of periodic penalty payments running as of 27

June 2025, as indicated in the non-compliance decision."

Meta accused the Commission of discriminating against the

company and for moving the goalposts during discussions over the

last two months.

"A user choice between a subscription for no ads service or

a free ad supported service remains a legitimate business model

for every company in Europe - except Meta," a Meta spokesperson

said.

"We are confident that the range of choices we offer people

in the EU doesn't just comply with what the EU's rules require -

it goes well beyond them."

"At a time when there are growing voices across Europe to

change direction and focus on innovation and growth, this

signals that the EU remains closed for business."

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