Elon Musk's X Found In Breach Of EU Digital-Content Law, Faces Potential Fine Of Up To 6% Of Global Turnover

Elon Musk’s social media platform X has been found in violation of the European Union’s online content law. The preliminary decision by the EU’s executive arm could result in a fine for the company.

What Happened: The European Commission’s decision on Friday was the culmination of a lengthy investigation into X, previously known as Twitter, reported The Wall Street Journal.

The probe aimed to ascertain if the platform had violated the Digital Services Act, a law that mandates major online platforms to address illegal content and provide transparency in content moderation and advertising, among other regulations,

The Commission identified three areas of concern regarding X’s content practices. These could lead to a fine of up to 6% of the company’s total worldwide annual turnover. The grievances include the platform’s illegal verification tool, the lack of compliance with advertising transparency rules, and the inaccessibility of public data to researchers.

If the Commission’s preliminary findings are confirmed, X could be subjected to an enhanced supervision period to ensure compliance and periodic penalty payments to enforce compliance.

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Why It Matters: Musk’s X has been under the EU’s radar for a while. In October, it was reported that Musk was considering pulling X out of Europe over compliance issues related to the Digital Services Act. This was after he acquired the platform for $44 billion and implemented several changes that drew the ire of European regulators.

Earlier this month, the EU announced plans to charge Meta Platforms Inc. for breaching its digital regulations. The regulators are likely to raise concerns about Meta’s “pay or consent” model, which gives users the option to use social networks for free in exchange for data collection consent or pay to avoid their data being shared.

Meanwhile, in March, Meta bowed down to EU regulations after Apple and Google cut subscription prices for ad-free Facebook and Instagram. This decision aimed to address the growing concerns of privacy and antitrust regulators.

Elon Musk’s X has also been a proponent of free speech. In June, Musk stated that freedom of speech is worth fighting for after Australia dropped a legal battle against X over church stabbing videos.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote