Direct advertising
through
Registration.
Direct advertising
through
Registration.
from
Can a company regularly advertise to users by email simply because they have registered for free? And is the mere registration sufficient as an “economic transaction”?
Free registration – and daily mail
Many digital business models are based on a simple principle: free account, limited access, regular references to further – often paid – content. This makes sense from a marketing perspective, but is tricky in terms of data protection law . The European Court of Justice had to rule in the Decision of 13.11.2025 – Ref. C-654/23 clarify whether the processing of an email address as part of a free registration can constitute a legitimate interest in direct advertising. The answer is surprisingly business-friendly – but with clearly defined limits.
Free registration as an economic act
In the original case, a media company operated a platform on which users could read a number of articles after registering free of charge. At the same time, they received a daily newsletter with summaries and links to in-depth, paid content. The national supervisory authority deemed this to be inadmissible advertising use of the email addresses because the registration did not include express consent to the newsletter.
The Court of Appeal turned to the Court of Justice with the question of whether a free registration can even be considered a “sale of a service” within the meaning of the European rules on direct advertising. It is precisely this term that determines whether companies are allowed to send electronic advertising without express consent.
Free services can also be a “sale”
The court used the proceedings to interpret the concept of sale broadly. The decisive factor is not whether a user pays for a service. The decisive factor is whether the offer is embedded in an economic model. Many digital business models rely on initially attracting users free of charge in order to later advertise a premium product.
In the opinion of the Court of Justice, this connection constitutes an economic service. If users provide their email address as part of this registration, this is not done “without consideration”. They receive access to content, while the company uses the address to promote its business model. This legally constitutes a transaction that is equivalent to a sale.
The consequence: the e-mail address was collected “in connection with the sale of a service” – and thus in principle opens up the exception rule for direct advertising.
Direct advertising remains direct advertising – no matter how informative the newsletter may seem
As business-oriented as the interpretation of sales is, the court remains strict when it comes to the definition of advertising. Although the media company’s newsletter contained editorial references, it systematically led users to paid content. This is sufficient to classify it as direct advertising.
A newsletter is therefore not “neutral” because it also provides information. The decisive factor is whether it steers users in the direction of a product or service.
This means that the special rule set out in the Directive on electronic communications applies:
Electronic direct marketing is generally subject to consent – unless the conditions of the narrow exception are met.
Legitimate interest: When the exception applies – and when it doesn’t
The decision clearly shows that companies with free registration can have a legitimate interest in informing users about similar services of their own – including those that are subject to a charge. Such advertising may be permissible within the scope of the exception if the following conditions are met:
- Registration is part of an economic model and is therefore legally equivalent to a sale.
- The advertising refers to own, similar services.
- Users are clearly informed of their right to object when their address is collected.
- The communication does not exceed the scope of the originally expected offer.
The ruling thus creates legal certainty for providers who base their business model on free registration and subsequent monetization. However, it also prevents the exception from becoming a free pass. As soon as advertising goes significantly beyond the “similar offer” or more intensive marketing takes place, the protective effect of the exception ends.
Consequences for practice: room for maneuver – but clean documentation
For companies with registration-based business models, the decision means one thing above all: free registration can serve as an economic basis for asserting a legitimate interest in direct advertising. This applies in particular to newsletters that are intended to lead users step by step to more in-depth, fee-based offers.
However, the scope remains narrowly defined. Providers must transparently explain why and to what extent free registration is economical. In addition, clear information is needed during the registration process, reliable options for objection and a consistent restriction to similar services. Anyone who uses the newsletter as a comprehensive advertising platform for completely new products immediately leaves the scope of protection – with the usual risks of sanctions and fines.
Conclusion
The court confirms the reality of modern digital business models: free registration is not an altruistic gesture, but part of an economic exchange – and can therefore legally be considered a sale. Companies may use this registration to directly advertise to users to a limited extent. The line is drawn where transparency, earmarking and proximity to the original offer are lost.
We are happy to
advise you about
Data protection law!
