EU Threatens $1B Fine Against X, Including Musk's Other Ventures

Elon Musk’s social media platform X is facing a potential billion-dollar fine from the European Union for alleged violations of the Digital Services Act (DSA). This regulatory action underscores the growing tension between EU authorities and the platform, which was formerly known as Twitter. The DSA, enacted in October 2022, aims to regulate social media companies and curb illegal and harmful content online.

What sets this case apart is the method EU regulators plan to use for calculating the fine. According to reports, the EU intends to include revenue from Musk’s other companies, such as Tesla and SpaceX, in their calculations. The DSA allows regulators to impose fines of up to 6% of a company’s global revenue for violations. By incorporating Musk’s other ventures, the potential fine could reach the $1 billion mark. This approach has sparked controversy, with X’s Global Government Affairs team labeling it as “an unprecedented act of political censorship and an attack on free speech.” The team has vowed to defend their business and protect freedom of speech in Europe.

The EU’s actions extend beyond financial penalties. Regulators are also expected to demand product changes to the platform. The full scope of these penalties is anticipated to be announced in the coming months, although a settlement could be reached if X agrees to make changes that address the regulators’ concerns. This is not the only regulatory challenge X is facing. The platform is also under a second investigation for allegedly failing to adequately police user-generated content, making it a hub for illegal hate speech and disinformation.

The EU investigation into X began in 2023. A preliminary ruling in July 2024 found that X had violated the DSA on multiple fronts, including refusing to provide data to outside researchers and failing to offer adequate transparency about advertisers. Another violation involved failing to verify the authenticity of users with verified accounts. X responded to these preliminary findings with numerous points of dispute. Musk claimed that he was offered a deal by EU regulators, alleging they told him X would escape fines if he secretly suppressed certain content on the platform. Thierry Breton, the former EU commissioner for internal market, denied this claim, stating there was no secret deal and that their response was in line with established regulatory procedures.

Musk has expressed his willingness to engage in a public legal battle to reveal the truth to the people of Europe. The penalties are expected to be announced this summer, with EU regulators using X as an example to deter other companies from violating the DSA. European authorities are reportedly considering the potential backlash from President Trump, given the broader conflicts between the EU and the US regarding trade, tariffs, and geopolitical issues. A European Commission spokesman declined to comment specifically on this case but affirmed that the Commission would continue to enforce its laws fairly and without discrimination toward all companies operating in the EU.