Elon Musk's Company Faces $140 Million Fine for EU Transparency Violations

Regulators from the European Union have imposed a $140 million fine on Elon Musk's social media entity X for breaching regulations designed to safeguard internet consumers from digital exploitation within the EU market.

According to an announcement from the European Commission, X has not adhered to 'transparency duties' as stipulated by the Digital Services Act (DSA), marking the first instance of a company being penalized under the 2022 law.

The Commission's statement accused X of misrepresenting the 'blue checkmark' feature. This verification, which can be purchased, creates difficulties for users in assessing the credibility of accounts, potentially exposing them to fraudulence and 'various manipulative threats' as per the EU.

Moreover, the European Commission criticized X's advertisement archive for not meeting the accessibility standards outlined in the DSA. Such platforms must maintain a complete record of digital ads including details on the sponsors and target audience, aiding researchers in recognizing fraudulent ads and orchestrated misinformation efforts.

X now faces a two-month deadline to inform the European Commission about its plan to rectify these issues.

Brendan Carr, Chairman of the Federal Communications Commission, criticized the penalty, asserting that the EU is unjustly targeting a thriving American tech company.

X has yet to issue a public response to inquiries regarding the fine.

Under the DSA, platforms are obliged to eliminate 'illegal content' among other restrictions; non-compliance could result in severe penalties. This law has been a contentious point between American tech firms and the U.S. government, which argue it undermines freedom of expression.

At a conference in Munich earlier this year, Vice President J.D. Vance equated the EU's content moderation policies to 'authoritarian censorship,' according to a report from the Center for Strategic and International Studies.