EU fines Elon Musk’s X $140M for breaching transparency regulations

The European Union has imposed a $140 million (120 million euros) fine on Elon Musks social media platform X for violating online transparency regulations, marking the first enforcement action under the EUs Digital Services Act.

The European Commission highlighted several violations, including the misleading design of Xs blue verification badge, insufficient transparency in its advertising database, which omits crucial information, and the inability to provide researchers with access to public data.

On X, users can pay to obtain verified status without meaningful verification of the account holder, making it hard to determine the authenticity of accounts and content, the Commission stated. This lack of clarity exposes users to scams, impersonation, and other manipulative actions by malicious actors.

The Commission has been investigating Xs compliance with the Digital Services Act for nearly two years. Formal proceedings into Xs potential involvement in spreading illegal content and the effectiveness of its measures to combat information manipulation will continue. Preliminary findings regarding the current breaches were released in July 2024.

Under the Digital Services Act, which aims to protect online user rights and ensure fair competition among platforms, X now has 60 working days to submit a plan addressing the misleading use of blue checkmarks. Additionally, it has 90 working days to propose remedies for issues related to advertising transparency and access to public data.

After receiving Xs action plan, the EUs Board of Digital Services will review it within one month and issue a final decision and implementation timeline within an additional month. Failure to comply may result in recurring penalty payments.

The Commission noted that the fine was calculated based on the severity, duration, and impact of the violations on EU users.

Author: Ethan Caldwell