EU hits Elon Musk's X with $140M fine over business practices

The European Union has announced a fine of $140 million against Elon Musk's X, the social media platform formerly known as Twitter, for several failures to comply with rules governing large digital platforms. A European Commission spokesperson said the fine against X's holding company was due to the platform's misleading use of a blue check mark to identify verified users, a poorly functioning advertising repository, and a failure to provide effective data access for researchers.

Europe's preference had not been to fine X, said the spokesperson, Thomas Regnier, as he drew a contrast with the Chinese-owned platform TikTok. Regnier announced Friday that TikTok had separately offered concessions that would allow it to avoid such penalties.

"If you engage constructively with the Commission, we settle cases," Regnier said at a press conference in Brussels. "If you do not, we take action."

The possibility that X would face financial penalties in Europe had drawn significant political fire, not only from Musk but also from others in Washington, D.C., over the past two years since the European Commission began its investigation.

"Rumors swirling that the EU commission will fine X hundreds of millions of dollars for not engaging in censorship," Vice President J.D. Vance wrote on X on Thursday. "The EU should be supporting free speech, not attacking American companies over garbage."

In July 2024, in a set of preliminary findings, the European Commission formally accused X — which serves more than 100 million users within the EU — of several violations. These included its failure to meet transparency mandates, obstructing researchers' access to data and misleading users by converting the blue verification badge into a paid subscription feature.

Musk has long stated his intention to legally challenge any EU sanctions, rather than make concessions to resolve the investigation.

Nonetheless, the company could have faced far higher financial penalties, with European authorities able under new legislation — known as the Digital Services Act — to fine offenders 6% of their worldwide annual revenue, which in this case could have included several other of Musk's companies, including SpaceX.

The fine announcement follows months of accusations from activists and trade experts that authorities in Brussels were deliberately easing up on enforcement to appease U.S. President Donald Trump. Musk was a prominent supporter of Trump's campaign and spent several months this past spring serving as an administration adviser and the public face of the Department of Government Efficiency initiative.

The willingness to take on Musk's business empire could serve as a critical test of the EU's determination, especially in light of Trump's previous threats of tariffs over the bloc's fines against U.S. technology giants.

The confrontation highlights a growing division over the concept of digital sovereignty, which has transformed long-standing allies into competitors as Europe strives to establish itself as the global authority for digital regulation, and the Trump administration pushes back against perceived curbs on U.S. companies' profits and freedom of expression.

So, experts warn, this direct punitive action against Musk's businesses carries the risk of U.S. retaliation, even though the EU remains heavily dependent on American technology for a range of sectors.

The United States is already leveraging some of these concerns about free speech as grounds for denying U.S. visas to certain individuals.

The Trump administration also has consistently argued that the EU unfairly targets U.S. technology companies with severe financial penalties and burdensome regulations, equating these measures to tariffs that justify trade retaliation. Just last week, U.S. Commerce Secretary Howard Lutnick stated that the EU must revise its digital regulations to secure a deal aimed at reducing steel and aluminum tariffs.

The Commission denied again Friday any connection between the trade negotiations with the U.S. and the implementation of its technology rulebooks, any targeting of American firms or any kind of infringement on freedom of expression.

"Our digital legislation has nothing to do with censorship," said Commission spokesperson Regnier. "We adopt the final decision, not targeting anyone, not targeting any company, not targeting any jurisdictions based on their color or their country of origin."

Despite the Trump administration's pressure, the EU has proceeded with the enforcement of its digital antitrust rules, recently imposing fines of $584 million on Apple Inc. and $233 million on Meta Platforms Inc.

It also has issued substantial penalties against other corporations, including over $8 billion total in fines against Alphabet Inc.'s Google over several years and a separate directive for Apple to repay €13 billion in back taxes to Ireland for providing unfair state aid.

Other potentially more serious concerns about X's management of illegal content, election-related misinformation and the utilization of Community Notes have not yet progressed to the preliminary stage in a separate investigation by the European Commission.