Elon Musk's X Fined $120 Million for Breaches of EU Digital Laws

Elon Musk's social media platform, X, has been fined €120 million ($105 million) after being found in breach of newly established EU digital laws. This landmark ruling is expected to create tension between the European Commission and the billionaire, potentially impacting relations with Donald Trump as well. The European Commission's investigation, which lasted two years, revealed several infractions including a misleading blue verification tick issued to users, alongside transparency issues related to advertising practices. Under the Digital Services Act (DSA), tech companies are mandated to maintain a public list of advertisers to mitigate risks associated with illegal scams, fake advertisements, and coordinated campaigns, especially in the context of political elections. Another significant breach identified by the EU pertains to X's failure to provide necessary access to public data for researchers monitoring contentious issues like political content. This ruling marks a critical development in the European Commission's actions, as it is the first ruling under the stringent DSA legislation enacted in 2023. The commission commenced formal proceedings in December 2023 to examine potential DSA breaches related to the spread of illegal content and the effectiveness of measures intended to counteract information manipulation. X is liable for fines up to 6% of its worldwide revenue, estimated between $25 billion and $27 billion for 2024. Three additional investigations are ongoing, two of which involve changes made to content promotion algorithms post-Musk's takeover of Twitter in October 2022, now rebranded as X. Authorities are also probing whether X has violated laws against incitement to violence or terrorism, as well as how users can flag and report illegal content. The €120 million fine is composed of three parts: €45 million for the sale of blue verification ticks that misled users about account authenticity, €35 million for advertising law violations, and €40 million due to issues with data access for researchers. Initially, blue ticks were reserved for verified public figures and journalists, but after Musk's acquisition, users subscribing to X Premium became eligible for this status. This ruling could provoke displeasure from Trump's administration. Recently, U.S. Commerce Secretary Howard Lutnick suggested that the EU should reconsider its tech regulations in light of potential tariffs impacting steel trade. EU officials, however, have made it clear that the ruling stands independently of any external diplomatic pressure. They maintain their right to enforce regulations on U.S. tech firms, as well as non-U.S. entities like TikTok, which has made commitments to improve advertising transparency. Musk now has 90 days to devise an action plan in response to the fine, although he retains the option to appeal the ruling in the European Court of Justice, a path previously taken by other tech giants like Apple. The EU asserts that a rigorous adherence to regulations is crucial to address emerging concerns around fake political advertisements and deceptive practices that undermine public trust and safety. X's management has been approached for comment, while the European Commission has already announced measures to hold platforms accountable for transparency in advertising, underscoring the importance of equity and accountability in digital spaces. Related Sources: • Source 1 • Source 2