The European Union has fined Elon Musk’s social media platform X €120 million ($140 million) for breaching its transparency rules set out in its Digital Services Act (DSA).
“Deceiving users with blue checkmarks, obscuring information on ads and shutting out researchers have no place online in the EU,” said European Commission Vice President Henna Virkkunen.
Pre-empting the announcement on Thursday night, United States Vice President JD Vance that “the EU should be supporting free speech not attacking American companies over garbage.”
Virkkunen said the ruling had “nothing to do with censorship,” adding: “If you comply with our rules, you don’t get a fine. It’s as simple as that.”
Why has the EU fined X?
The heavy fine is the first such punishment issued by the European Commission, which began its investigations into X in December 2023.
Among other things, Brussels accuses the platform of using the white and blue checkmarks for paid user accounts to falsely suggest that these accounts are authentic and verified.
The Commission also criticized that it is not always clear who is behind advertising on X.
DSA fines can be as high as 6% of a company’s annual global revenue, but the Commission said X’s annual turnover didn’t play a direct role in the calculation of the fine.
According to the EU decision, the penalty consists of three parts: €45 million for the verification checkmarks, €35 million for the lack of advertising transparency, and €40 million for the lack of data access for researchers.
“We are not here to impose the highest fines,” insisted Virkkunen. “We are here to make sure that our digital legislation is enforced.”
Additional “very broad” investigations into Musk’s platform are ongoing, according to the EU, including into whether X has taken sufficient action to combat the spread of illegal content and manipulated information.
How has the US government reacted to the EU fining X?
But the US government has criticized the bloc for “regulatory suffocation” and threatened trade consequences, with US Commerce Secretary Howard Lutnick last week pressing the EU to rethink its rules if it wants lower steel duties.
Brendan Carr, the chairman of the Federal Communications Commission (FCC), the US agency which regulates national and international radio, television, wire, satellite, and cable communications, condemned the EU.
In a post on X, Carr accused the bloc of “fining a successful US tech company for being a successful US tech company.”
“Europe is taxing Americans to subsidize a continent held back by Europe’s own suffocating regulations,” Carr said.
Edited by: Roshni Majumdar