The European Commission has penalized Elon Musk’s social media platform X with a fine of €120 million (about £105 million) for breaking essential transparency rules set out in the European Union’s Digital Services Act (DSA). This is the European bloc’s first formal enforcement action against the company under its landmark digital regulation. The verdict will likely increase the conflict level between Brussels, Musk, and possibly the administration of former US president Donald Trump.
Findings After Two-Year Probe
The inquiry into X spans almost two years and concentrated on three significant areas where the platform allegedly did not comply with the law. The Commission discovered that X deceived users by its newly designed blue tick verification system, didn’t give enough transparency in advertising, and refused researchers sufficient access to public data.
Breakdown of the €120 Million Fine
Top EU officials commented that the fine was broken down into three parts: €45 million concerning the platform’s “deceptive” paid blue tick system, €35 million for advertising transparency violations, and €40 million for data access-related research obligations breaches.
Blue Tick Policy Under Fire
Before Musk bought Twitter in October 2022, blue ticks were the privilege of verified public figures such as politicians, journalists, celebrities, and institutions. After the change to X, the platform enabled any user who paid for its premium subscription to get verification, which the Commission argued made it impossible for users to accurately identify authentic accounts.
Advertising Transparency Failures
The Commission also concluded that X had infringed the obligations that required platforms to disclose an easily accessible and searchable public repository of advertisements. According to the DSA, this is meant to be a tool for regulators, researchers, and civil society groups in detecting fraudulent ads, illegal promotions, and coordinated political campaigns, particularly around elections.
Researchers Denied Data Access
Moreover, officials determined that X insufficiently allowed independent researchers access to platform data to monitor such sensitive issues as political discourse and information manipulation.
Separate Probes Still Ongoing
The decision only closes the investigation into X that’s been a part of a larger picture. In December 2023, the European Commission launched a formal investigation to assess whether the platform had violated the DSA by spreading illegal content and if the measures in place to combat disinformation and coordinated manipulation were effective.
Algorithm and Safety Concerns
There are still three other investigations in progress, two of which are about changes in content moderation and recommendation algorithms that were introduced after Musk’s takeover. Besides, the Commission wonders if X has violated EU laws that forbid incitement to violence and terrorism, as well as whether its user reporting systems meet legal standards.
Size of Potential Penalties
Per the DSA, the companies might be imposed fines up to 6% of their global yearly revenue. X’s 2024 revenue was estimated to be somewhere between $2.5 billion and $2.7 billion, so the potential maximum punishment could have been substantially higher.
Political Fallout With Washington
The penalty will almost certainly provoke a vehement response from Washington. A day before, US Vice President JD Vance, while the decision was still being speculated, criticized the EU, blaming it for “attacking American companies over garbage” instead of promoting free speech. Musk on X publicly thanked him for the comment.
Trade Tensions Escalate
Last week, US Commerce Secretary Howard Lutnick warned the EU that it must rethink its tech regulations if it wants to enjoy reduced tariffs on European steel. EU competition and green transition commissioner Teresa Ribera rejected his comments as “blackmail”.
EU Defends Regulatory Authority
Senior EU officials answered by stating that the judgement was legally independent of trade talks and Brussels had its “sovereign right” to regulate technology firms within the bloc. They pointed out that 25 companies, including those not based in the US like TikTok, are covered by the DSA.
Commission Stands Firm
The European Commission’s executive vice-president responsible for digital regulation, Henna Virkkunen, said the decision was made to safeguard users and maintain the accountability of those in power. She said, “Deceiving users with blue checkmarks, hiding information on ads, and shutting out researchers shouldn’t happen online in the EU.”
X Given 90 Days to Respond
Musk is given 90 days to file a plan of action to deal with the infractions. Moreover, X can also appeal against the ruling at the European Court of Justice just as the likes of Apple have done in previous regulatory conflicts.
TikTok Makes Separate Commitments
On the other hand, the Commission said it has received assurances from TikTok to facilitate advertising transparency by creating a public ad repository that complies with the standards. X has been notified of the decision and contacted for comment.
