Europe advertising industry opposes Digital Fairness Act

IAB Europe and a coalition of advertising industry associations submitted a joint letter on 14 July 2025 to European Commission executives, challenging the scope of the upcoming Digital Fairness Act consultation. The coalition argues that existing digital regulations already address consumer protection concerns driving the proposed legislation.

The letter, addressed to Executive Vice-President Henna Virkkunen and Commissioner Michael McGrath, warns against creating overlapping regulatory frameworks. According to IAB Europe, digital advertising already operates under comprehensive rules through the Unfair Commercial Practices Directive, Digital Services Act, and General Data Protection Regulation.

The industry has extensive regulatory coverage already

The coalition emphasizes that personalised advertising faces regulation under multiple frameworks. The GDPR, ePrivacy Directive, DSA, and Digital Markets Act govern personalised advertisements. Profiling-based advertising targeting minors receives prohibition under the DSA for online platforms, while the GDPR severely restricts such practices according to data protection authorities' interpretations.

Sensitive data targeting for advertisements faces prohibition for online platforms under the DSA. The GDPR strictly regulates processing of special categories of data, allowing only specific and narrow use cases under stringent regulatory oversight. Additionally, the Transparency and Consent Framework version 2.2 does not support processing such data for personalised advertising purposes.

Consent requirements receive coverage under the GDPR, ePrivacy Directive, and Data Protection Authorities' guidance. The letter states that any new obligations should align carefully with this framework to avoid duplication. Provisions against dark patterns exist in the UCPD, DSA, GDPR, and AI Act.

Influencer marketing regulation already exists through the UCPD, AVMSD, and DSA, which ban all forms of hidden advertising. The coalition notes that issues related to advertisement disclosure reflect enforcement gaps rather than legislative ones. Industry initiatives such as the AdEthics programme require support and recognition.

Technical regulation spans multiple sectors

Advertising verticals face heavy prohibition or regulation at European level, including tobacco and credit products. National-level restrictions cover alcohol and gambling across various member states. France, Lithuania, and Ireland have introduced regulations restricting alcohol advertising. Italy, Spain, and the Netherlands represent examples of EU Member States introducing rules and restrictions on gambling advertising.

The European Tobacco Products Directive and the Directive on credit agreements for consumers provide examples of sectorial regulation on advertising. Given the period of intense legislative activity that introduced the EU's Digital Rulebook, the threshold for introducing new rules must reach high standards.

Commission urged to prioritise enforcement over new rules

The coalition calls on the European Commission to target enforcement efforts where egregious breaches remain. They request prioritisation of aiding company compliance with existing rules, especially European consumer protection laws. The letter emphasises evaluating the impact of DSA rules, which only entered into force after the Digital Fitness Check was completed.

The Digital Fitness Check of EU consumer law showed no lack of rules, rather a need for more effective enforcement along with workable guidance. The signatories want thorough assessment of whether regulatory gaps exist through auditing all applicable laws and regulation. They request limiting any consultation or impact assessments to genuinely unregulated policy areas not already covered by other laws.

Mario Draghi's competitiveness report receives citation for warning against over-regulation and its harm to Europe's economies. The letter argues that overlapping rules would confuse organisations, regulatory authorities and users, undermining regulatory efficiency and contradicting the Commission's simplification goal.

Complex compliance framework emerges

The industry letter highlights the complexity of the current regulatory environment. European data protection regulations continue evolving through court decisions that clarify compensation standards for violations. Meanwhile, Digital Services Act implementation requires technical solutions from industry associations to meet transparency requirements.

Platform-specific compliance measures demonstrate the regulatory burden. LinkedIn discontinued group-based targeting in Europe to comply with DSA requirements following civil society complaints. The European Commission's own illegal targeting practices on X highlight enforcement challenges even for regulatory authorities.

The coalition stresses that digital services thrive on trust, noting that trust is hard-gained and easily lost. They commit to engaging with the Commission to ensure enforcement of existing rules creates an equal-playing field for businesses and consumers. "No additional rules can replace a lack of effective enforcement," the letter states.

Industry calls for evidence-based approach

The advertising associations invite the European Commission to acknowledge their openness to addressing genuine regulatory gaps. However, they emphasise demonstrating that consumer protection concerns underpinning the DFA are not already adequately covered by existing legislation, particularly regarding digital advertising.

Any proposed interventions should receive thorough assessment for their impact and consistency with the simplification agenda. The letter represents a collaborative effort from organisations spanning the digital advertising ecosystem, including advertisers, advertising agencies, publishers, and ad tech intermediaries.

The signatories include Interactive Advertising Bureau Europe, Alliance Digitale, Portuguese Association of Advertisers, German Association for the Digital Economy, and IAB chapters from Ireland, Portugal, Poland, Slovakia, Spain, and Sweden. The German Advertisers Association also joined the coalition.

Timeline

• March 2024 - EU political advertising transparency regulation adopted
• June 2024 - LinkedIn removes group targeting in Europe due to DSA compliance
• November 2023 - IAB Europe publishes DSA transparency solution
• December 2024 - EU watchdog rules Commission illegally targeted political ads
• July 2025 - IAB Europe coalition submits Digital Fairness Act challenge letter

Key Terms Explained

Digital Fairness Act (DFA): A proposed European Union regulation aimed at strengthening consumer protection in digital markets. The DFA would establish new rules for online commercial practices, with particular focus on digital advertising transparency and fairness. The legislation emerges from concerns about consumer manipulation and unfair commercial practices in digital environments, though its scope and final provisions remain under consultation.

Unfair Commercial Practices Directive (UCPD): A foundational EU law from 2005 that prohibits misleading and aggressive commercial practices across all sectors. The directive establishes general principles for fair trading and provides a comprehensive framework for identifying when business-to-consumer commercial practices become unfair. It covers both misleading actions and omissions, aggressive practices, and maintains a blacklist of practices that are always considered unfair.

Digital Services Act (DSA): A comprehensive EU regulation that came into force in 2022, creating a uniform framework for regulating online intermediary services. The DSA addresses illegal content removal, transparency requirements for algorithms and advertising, risk management for large platforms, and user rights protection. It applies to all online intermediaries operating in the EU, with enhanced obligations for very large online platforms and search engines.

General Data Protection Regulation (GDPR): The EU's primary data protection law that took effect in 2018, establishing strict rules for processing personal data. The GDPR requires explicit consent for data processing, grants individuals extensive rights over their personal information, and imposes significant penalties for non-compliance. In advertising contexts, it governs how companies collect, process, and use personal data for targeting and personalization purposes.

Transparency and Consent Framework (TCF): An industry-standard technical solution developed by IAB Europe to help digital advertising companies comply with GDPR requirements. The framework enables websites and apps to collect, store, and share user consent preferences across the advertising supply chain. Version 2.2 specifically prohibits processing of sensitive data categories for personalized advertising, creating standardized consent management across participating organizations.

Dark patterns: Deceptive user interface designs that manipulate users into making unintended decisions or taking actions that benefit the service provider rather than the user. In digital advertising, dark patterns might include pre-checked boxes for data sharing, confusing consent interfaces, or misleading subscription sign-ups. Multiple EU regulations including the UCPD, DSA, GDPR, and AI Act contain provisions specifically targeting these manipulative design practices.

Profiling-based advertising: A form of targeted advertising that uses automated processing to analyze personal data and predict user preferences, behaviors, or interests. This technique involves creating detailed user profiles from browsing history, demographic information, and online activities to deliver personalized advertisements. The practice faces strict regulation under GDPR, particularly when targeting minors, and requires explicit legal basis and user consent in most circumstances.

Ad tech intermediaries: Technology companies that facilitate the buying, selling, and delivery of digital advertisements between advertisers and publishers. These intermediaries include demand-side platforms, supply-side platforms, data management platforms, and ad exchanges that enable programmatic advertising transactions. They play crucial roles in data processing, audience targeting, and campaign optimization, making them subject to various privacy and transparency regulations.

Special categories of data: Sensitive personal information that receives enhanced protection under GDPR due to its potential for discrimination or harm. These categories include data revealing racial or ethnic origin, political opinions, religious beliefs, trade union membership, genetic data, biometric data, health information, and data concerning sexual orientation. Processing such data for advertising purposes requires explicit consent and strict safeguards, with very limited exceptions.

Digital Markets Act (DMA): EU legislation targeting large technology companies designated as "gatekeepers" to ensure fair competition in digital markets. The DMA imposes specific obligations on platforms with significant market power, including requirements for interoperability, data portability, and restrictions on self-preferencing. While primarily focused on competition rather than advertising, it affects how major platforms can use data for advertising purposes and influences the broader digital advertising ecosystem.

Summary

Who: IAB Europe coalition including national federations and advertiser associations across Europe submitted the letter to EU executives Henna Virkkunen and Michael McGrath.

What: A joint letter challenging the Digital Fairness Act consultation scope, arguing existing regulations already address consumer protection concerns through GDPR, DSA, and UCPD frameworks.

When: The letter was submitted on 14 July 2025, following media reports about the European Commission's tender for a DFA policy options study.

Where: The letter was sent to Brussels, targeting the European Commission ahead of the Digital Fairness Act consultation process affecting the entire EU digital advertising ecosystem.

Why: The coalition seeks to prevent regulatory duplication that would confuse companies, regulators, and consumers while undermining legal clarity and increasing compliance burdens contrary to EU simplification objectives.