EU Slaps Elon Musk’s X With $140 Million Fine Over Content Rules

The European Commission fined billionaire entrepreneur Elon Musk’s X social media company 120 million euros ($140 million) on Dec. 5 following a two-year investigation under the Digital Services Act (DSA).

The commission stated that X breached several transparency obligations, including the “deceptive design of its ‘blue checkmark,’ the lack of transparency of its advertising repository, and the failure to provide access to public data for researchers.”

In the bloc’s latest challenge against U.S. tech giants, the European Commission said the platform’s verified badge was converted into a paid feature without adequate identity checks. Regulators argued this misled users into believing accounts were authentic, exposing them to impersonation, manipulation, and fraud.

X’s advertising library failed to meet the DSA’s accessibility and detail standards, omitting key information that hindered efforts to track coordinated disinformation, election interference, and illicit activities, according to the commission.

In addition, the tech regulators claimed that X installed barriers preventing eligible researchers from accessing engagement metrics, such as impressions, likes, and shares.

The social network’s terms of service prohibit eligible researchers from independently accessing public data and impose restrictive processes that create unnecessary barriers, the commission said. These limits undermine research into systemic risks in the European Union, such as disinformation and election interference.

“With the DSA’s first non-compliance decision, we are holding X responsible for undermining users’ rights and evading accountability,” Henna Virkkunen, the commission’s executive vice president for tech sovereignty, security, and democracy, said in a statement.

X will now have 60 days to inform the European Commission of how it will address what the commission called “deceptive” blue checkmarks and 90 days to submit a plan to resolve issues regarding ads and public data.

“Failure to comply with the non-compliance decision may lead to periodic penalty payments,” the commission said in a statement.

Prior to the European Commission’s announcement on X, U.S. Vice President JD Vance weighed in, encouraging the bloc to support free speech.

“Rumors swirling that the EU commission will fine X hundreds of millions of dollars for not engaging in censorship,” Vance said on X. “The EU should be supporting free speech, not attacking American companies over garbage.”

Meanwhile, the fine on X comes a day after the bloc said it had opened an investigation into tech giant Meta for potentially breaching EU competition rules regarding artificial intelligence (AI) providers’ access to WhatsApp.

Mark Zuckerberg’s company announced in October that it would restrict AI providers from using a tool that allows businesses to contact customers through WhatsApp when AI is the primary service offered.

“We must ensure European citizens and businesses can benefit fully of this technological revolution and act to prevent dominant digital incumbents from abusing their power to crowd out innovative competitors,” the bloc’s commissioner for competition, Teresa Ribera, said in a Dec. 4 statement.

Secretary of State Marco Rubio called the fine an “attack” on all U.S. tech platforms.

“The European Commission’s $140 million fine isn’t just an attack on @X, it’s an attack on all American tech platforms and the American people by foreign governments,” Rubio said on Dec. 5 in a statement on X. “The days of censoring Americans online are over.”

Digital Services Act

In 2022, the EU adopted the Digital Services Act, a regulation that establishes strict rules for how online entities operate, from user protection to advertising transparency.

But critics say it threatens free speech and could lead to a “global censorship regime.”

“The DSA could install a global censorship regime and is the greatest threat to online freedom of expression in the Western world today. We will continue to advocate for the protection of free speech in light of the DSA’s censorial threat in order to keep the digital public square free,” Adina Portaru, senior counsel at Europe for Alliance Defending Freedom (ADF) International, said in a Nov. 20 statement.

U.S. officials have also criticized the bloc’s digital playbook in recent months.

U.S. Commerce Secretary Howard Lutnick, during a Nov. 24 interview with Bloomberg Television, said Europe’s rules and regulations unfairly target Amazon, Google, and Microsoft. He urged the bloc to consider a “reasonable framework” for big U.S. tech companies so they can make billions of dollars in investments in the European economy.

In addition, Lutnick said that the United States would implement changes to tariff rates on the bloc’s steel and aluminum exports.

“They would like to have steel and aluminum as part of this package, and we think it is very, very important that they understand our digital companies and they reconsider their digital regulations to be more inviting to our big companies,” Lutnick said last month.

EU regulators have attempted to simplify their digital rules.

Last month, the commission introduced a digital omnibus to simplify current rules on AI, cybersecurity, and data that officials say will bolster innovation, ease compliance, and reduce red tape.