The EU is considering imposing a fine on Meta, which operates Facebook and Instagram. This is because Meta is confusingly explaining to users the paid and free versions of Facebook and Instagram. The EU’s Consumer Protection Cooperation Organization (CPC) is looking into whether Meta violates the Consumer Protection Act. The CPC warned that Meta could be fined if it does not clarify the difference between the paid and free versions by September 1.
Meta’s “pay or consent” model, introduced last year, is a model in which users pay 12.99 euros per month to use Facebook and Instagram without advertising, or Meta agrees to collect personal data for personalized ads without paying.
After receiving a report from a consumer watchdog that Meta was confusingly explaining how these two models worked, the CPC launched an investigation. The consumer watchdog argues that Meta is not giving users enough time to choose between the two models. It also argues that it is misleading to describe personal data collection for customized advertising as “free.”
CPC pointed out that even if a user chooses a free model, Meta should not attract users by saying “free” because it generates revenue through customized advertisements. CPC emphasized that companies should transparently disclose how they use their data.
The EU continues to strengthen regulations on platform companies’ violations of the Digital Market Act (DMA). Violation of the DMA may result in a fine equivalent to up to 10% of global annual sales.
EJ SONG
US ASIA JOURNAL
