Madrid: A Madrid court has ordered Meta, the parent company of Facebook and Instagram, to pay £479 million ($551 million) to 87 Spanish digital media outlets and news agencies for unlawfully using personal data to gain an advertising advantage, the court revealed on Thursday. The mercantile court found that Meta extracted and used protected user data in violation of EU law to construct more effective targeted ads, granting the company an 'illicit' and 'significant' competitive edge.

According to Anadolu Agency, the court's ruling stated that the unlawful processing of a vast volume of personal data provided Meta with a competitive advantage that Spanish digital press outlets could not match. Spain's judiciary indicated that this decision, which is not yet final, could reshape the country's advertising market. It highlighted that local outlets had to compete against behavioral ads derived from data collected from Facebook, Instagram, and users' activities, not only from Meta's platforms but also from other websites users visited.

The court determined that after EU data regulations came into effect in May 2018, Meta transitioned from a consent-based model to 'contractual necessity,' a legal basis the judge considered invalid for personalized advertising. The ruling also criticized Meta Ireland for its refusal to provide revenue figures specific to Spain. The judge accepted estimates from media association AMI, concluding that Meta earned over £5.281 billion in Spain from personalized ads during the five-year infringement period. The court declared that since this income was generated illegally, it must be redistributed to the affected competitors, including the digital press.

Meta's practices, the court added, adversely affected the sustainability of Spanish outlets that depend on display advertising. Meta has announced plans to appeal the decision, describing it as a baseless claim that lacks evidence of alleged harm and disregards the workings of the online advertising industry. The company asserted its compliance with all applicable laws in a statement sent to the media.

The court noted that Meta had previously faced sanctions in Ireland in 2022 for improper data use. It suggested that this case could have broader implications across the EU, where Facebook and Instagram operate consistently.