EU hits Musk’s X with $140m fine in landmark enforcement of digital transparency rules

The European Union has fined Elon Musk’s X a total of 120 million euros ($140 million) for violating key transparency provisions of the bloc’s Digital Services Act (DSA), marking the first major penalty against a social media platform under the new law and igniting fresh tensions with the United States.

The European Commission announced the fine on Friday, saying X – formerly Twitter – failed to comply with rules governing advertising transparency, researcher access to public data, and the authenticity of its verification system.

EU tech commissioner Henna Virkkunen insisted the ruling had “nothing to do with censorship,” countering accusations from U.S. Vice President JD Vance, who pre-emptively criticised Brussels for supposedly targeting American companies. “This decision is about the transparency of X,” she said.

Vance, in an X post a day earlier, warned that the EU “should be supporting free speech, not attacking American companies over garbage,” prompting Musk to respond: “Much appreciated.”

‘Deceptive design’ and verification concerns

AFP reports that the  penalty stems from a year-long investigation initiated in December 2023 after sweeping changes Musk introduced when he acquired the platform. Regulators say X’s paid verification program – which grants blue checkmarks without meaningful identity verification – misleads users and increases the risk of impersonation, scams, and other malicious activity.

“This deception exposes users to fraud and manipulation,” the Commission stated.

The EU also found that X has not adequately disclosed how advertising is targeted and disseminated on the platform, nor has it provided the required level of access for researchers studying online risks – both mandatory under the DSA.

Separate investigations into the spread of illegal content and disinformation on X are still in progress.

Political tension shapes enforcement

Brussels’ decision comes at a sensitive moment in U.S.-EU relations, with President Trump back in office and Musk regaining influence in Washington. Although the EU had the authority to levy a far larger penalty – up to 6 percent of global revenue – regulators opted for what they called a “proportionate” fine.

“We are not here to impose the highest fines,” Virkkunen said. “We are here to ensure that digital legislation is enforced.”

France’s digital affairs minister, Anne Le Henanff, hailed the ruling as “historic,” while Germany’s digital minister Karsten Wildberger stressed that the bloc’s rules “apply to everyone, regardless of where they come from.”

TikTok avoids penalty – for now

In a parallel announcement, the Commission said it had accepted corrective commitments from TikTok regarding its advertising system, though the platform remains under investigation for other suspected DSA breaches.

The fine against X is expected to set the tone for future enforcement as the EU seeks to assert global leadership in tech regulation – and underscores that Musk’s platform remains firmly in the crosshairs of European regulators.