The European Union has levied a major financial penalty against Elon Musk's social media platform, X. Regulators fined the company 120 million euros, equivalent to roughly $140 million, for failing to comply with the bloc's landmark digital rulebook.
First Major Penalty Under New Digital Law
This decision, announced by the European Commission on Friday, marks a significant milestone. It is the first non-compliance decision issued since the EU's Digital Services Act (DSA) came into full effect. The DSA is a sweeping set of regulations designed to force large online platforms to take greater responsibility for user safety and content moderation.
The investigation into X, which was known as Twitter before Musk's 2022 acquisition, began two years ago. The Commission's final ruling cites three specific breaches of the DSA's transparency requirements, which officials argue leave users vulnerable.
Deceptive Blue Checks and Obscured Ads
A central issue identified by regulators is X's system for account verification. Before Musk's takeover, the platform's blue checkmarks were largely reserved for verified public figures. After the acquisition, X began selling the badges for $8 per month without meaningful identity verification.
The Commission stated this practice constitutes "deceptive design" and makes it difficult for users to judge the authenticity of accounts and content, potentially exposing them to scams and manipulation.
Furthermore, X was found deficient in its advertising transparency. EU rules require platforms to maintain a searchable public database of all digital ads, including who paid for them and the target audience. This tool is vital for researchers investigating disinformation and fraudulent advertising. The Commission found X's ad library was undermined by design flaws and excessive delays in data access.
Barriers for Researchers and Global Repercussions
The third breach involves X creating "unnecessary barriers" for researchers seeking to access public data. This hinders independent study of systemic risks on the platform, a key requirement under the DSA.
EU Executive Vice-President Henna Virkkunen emphasized the importance of the ruling in a statement: "Deceiving users with blue checkmarks, obscuring information on ads and shutting out researchers have no place online in the EU. The DSA protects users."
This action could inflame tensions between Brussels and Washington, as the administration of former U.S. President Donald Trump has previously accused the EU of unfairly targeting American tech giants and vowed retaliation. The company did not immediately respond to requests for comment on the fine.
