From Consent to Coercion: The Underlying Legal Failure Behind Pay-or-Consent Models

-- By LiuZihua - 24 Mar 2025 (11 May 2025 Second Revision)

A. Introduction

The rise of pay-or-consent models on digital platforms presents users with a misleading choice: surrender personal data for behavioral advertising or pay a fee for privacy. Though this model may seem to offer autonomy, it rests on a dangerous and deeply flawed assumption that privacy is a commodity to be traded, rather than a fundamental right.

This paper argues that the Pay-or-Consent model is not just a flawed application of data protection law, but a symptom of a deeper structural failure: the mistaken reliance on consent as a legal basis for waiving fundamental privacy rights and limiting accountability. Privacy, as an inalienable and non-negotiable right, cannot be reduced to a market transaction or subject to individual bargaining.

B. Privacy Is Environmental, Not Transactional

International and domestic laws have long affirmed privacy as a fundamental human right—article 8 of the European Convention on Human Rights, article 11 of the American Convention on Human Rights, and numerous human rights treaties worldwide. By definition, fundamental rights are inalienable that they cannot be traded, surrendered, or made conditional on a person’s economic position or bargaining power. This is why legal systems do not allow individuals to “consent” to the loss of basic rights such as access to safe drinking water or personal security.

Privacy, as a similarly fundamental right, must be understood not as a transactional or waivable choice but as an environmental condition—a baseline necessary for meaningful participation in public, social, and economic life. Treating it otherwise, by allowing user consent to shield data controllers from liability, undermines the very notion that such rights are inalienable and equally guaranteed. Ultimately, any model that relies on consent to legitimize the erosion of privacy is structurally incompatible with a legal and ethical system that claims to uphold rights as universal and non-negotiable.

C. The Two-Layer Failure of the GDPR’s Consent Framework

A closely related legal framework to the Pay-or-Consent model is General Data Protection Regulation (GDPR), which was designed to protect personal data and affirm privacy as a fundamental right. But its central regulatory mechanism—consent—rests on a misguided premise that individuals can authorize the use of their personal data with some conditions, and that this authorization can shield data controllers from liability. In practice, this assumption collapses under real-world conditions of power asymmetry, economic pressure, and platform dominance. This heavy reliance on “consent” has not only failed to prevent models like Pay-or-Consent but may have actively facilitated their emergence.

(a) Surface Level—It Fails to Prevent the Coercive Models like Pay-or-Consent

On a surface level, the GDPR’s reliance on consent fails to prevent exploitative models like Pay-or-Consent. Although Article 4(11) requires consent to be “freely given” and Recital 42 prohibits consent where refusal results in detriment, Pay-or-Consent model effectively violates them. Users are coerced into accepting surveillance or paying a fee, especially in monopolized digital environments with no real alternatives.

This contradiction was further exposed in two recent rulings. Although the European Data Protection Board (EDPB)’s 2024 Opinion found such models generally invalid, and the Court of Justice of the European Union (CJEU) in Bundeskartellamt case acknowledged the “clear imbalance” between users and platforms, neither opinion prohibited the practice nor addressed the deeper flaw in the legal framework that enables it. The CJEU’s vague endorsement of “appropriate” privacy fees reflects not just enforcement failure but a deeper confusion about the role of consent in protecting fundamental rights.

(b) Deeper Level—Its Underlying Flawed Premise Enables the Emergence of These Coercive Models

At a deeper level, the GDPR’s failure stems not just from weak enforcement, but from a structural flaw in its foundational logic. By placing consent at the center of lawful data processing, the GDPR assumes that individuals can meaningfully authorize the use of their personal data and that this authorization can limit the liability of data controllers. This premise treats data privacy not as a universal, non-waivable right, but as a negotiable preference that individuals can surrender through consent mechanisms and contract-like transactions.

Practically, this legal premise enables, from the root, the rise of coercive models like Pay-or-Consent. Because the framework equates valid consent with lawful processing, it provides platforms with a path for compliance through appearance rather than substance. So long as a company can extract formal “consent”—regardless of the power imbalances, economic pressure, or lack of alternatives—it is insulated from legal accountability. It incentivizes companies to develop structurally coercive designs that exploit consent not as a safeguard, but as a liability shield.

Therefore, models like Pay-or-Consent are not legal anomalies but the predictable outcome of the legal structure. The implication of this structural failure is far-reaching in that data privacy is a public and environmental condition, which is essential to maintain baseline expectations of dignity, autonomy, and non-exploitation in digital life.

D. The Path Forward

To truly protect data privacy as a fundamental right, the law must go beyond banning coercive models like Pay-or-Consent and confront the deeper structural flaw in data protection frameworks: the reliance on consent as a basis for waiving rights and limiting liability. Privacy must be treated as a non-negotiable entitlement, not a market transaction. Addressing this requires legal reform that replaces consent-based frameworks with a rights-based model, which explicitly prohibits the commodification and surrender of privacy rights under the guise of individual choice.

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