EU Fines Meta over "Pay or Consent" Ads

What Changed

On April 23, 2025, the European Commission fined Meta €200 million for breaching the Digital Markets Act (DMA), the EU law that sets extra rules for the largest platforms, which it calls gatekeepers. It was one of the Commission's first two DMA non-compliance decisions; the other fined Apple €500 million over App Store rules.¹

Under the DMA, a gatekeeper must ask for users' consent before combining their personal data across its services, and users who say no must get a less personalized but equivalent alternative. In November 2023, Meta gave EU users of Facebook and Instagram a binary choice: consent to personalized ads, or pay a monthly subscription for no ads. The Commission found that this didn't offer the required option of a service using less of their data, and didn't let users consent freely. The fine covers March to November 2024, from when the DMA's obligations became binding to when Meta changed its model.¹

Less Personalized Ads

The subscription model was itself a response to earlier rulings. In January 2023, Ireland's Data Protection Commission ruled that Meta could no longer rely on its contract with users, or on legitimate interests, as the legal basis for personalized ads.² In November 2024, Meta added a free option, "less personalized ads", which chooses ads mainly from what someone views during a session, plus a minimal set of data: age, gender, location and how they engage with ads.²

The Commission kept assessing that option. In December 2025 it acknowledged Meta's commitment to give EU users a clear choice between sharing all their data for fully personalized ads and sharing less for more limited personalization, starting in January 2026. It said it would gather evidence on how many people choose the new option and how it affects the advertising market.³

On its January 2026 earnings call, Meta said the expected impact was built into its outlook and that its appeal would continue. It also warned that regulators or courts could demand further changes that might make its service materially worse in Europe.⁴

Why It Mattered

It was the first time the EU required a major ad platform to offer a free version with less behavioural targeting, rather than just a consent prompt. Advertisers on Facebook and Instagram in Europe now reach some of their audience with ads chosen largely from context. Meta, like Google with Consent Mode v2, has had to change how its own ad products work in the EU, and the Commission's review of uptake could bring more changes.