It seems that the Trump Administration’s long-running war of words with EU officials is set to come to a head, after the EU Commission issued Elon Musk’s X with a €120 million ($US140 million) fine late last week for breaches of the platform’s DSA obligations relating to transparency.
To recap, last year, former EU Commissioner Thierry Breton publicly criticized X’s changes to its verification system, which now enables anybody to buy a blue checkmark for their account. That’s in variance to the previous system, under Twitter, which was ostensibly designed to minimize misinformation by providing these checkmarks as a certification marker on the official profiles of known public figures, official brands and/or government bodies.
But because anyone can now buy a blue tick, that muddies the waters as to what the marker represents, which Breton claimed is deceptive, and thus, infringes DSA regulations relating to transparency and assurance.
Which you could argue Twitter’s system didn’t adequately address either, given the variable criteria applied to verification, while you could also argue that the blue tick has now been rendered so meaningless by Musk’s changes that people don’t trust it as a marker of trust anyway. But this is the core of the initial EU complaint with this element.
That, in combination with other transparency issues at X, then led to a new investigation.
In response to those initial claims, however, X owner Elon Musk was defiant, noting that X was looking “forward to a very public battle in court, so that the people of Europe can know the truth.”
And now, he may well get the chance, with the EU Commission issuing X with a hefty fine due to a violation of the DSA’s rules around deceptive design practices.
As per the official EU notification:
“This deception exposes users to scams, including impersonation frauds, as well as other forms of manipulation by malicious actors. While the DSA does not mandate user verification, it clearly prohibits online platforms from falsely claiming that users have been verified, when no such verification took place.”
Which points to X not really checking the background info of X Premium users, with those willing to pay being given a blue tick (you only need to verify a phone number to get a checkmark).
In addition to the checkmark concern, EU officials are also fining X for failing to maintain a searchable ad repository, and failing to meet its DSA obligations to provide researchers with access to the platform’s public data.
X will now have to pay the $140 million fine, while it will also have 90 days to submit a detailed action plan addressing the Commission’s concerns, in order to avoid further penalty.
Which X will no doubt now do, right? The company will align its processes with its EU operating requirements, and stay in the good books of EU regulators, in order to avoid further issues. Right?
Yeah, that’s not the path that Elon has chosen to take.
In response, Elon has essentially declared all-out war on the EU Commission, comparing it to the Nazi regime, supporting calls for the U.S. to leave NATO in response, and for the abolishment of the entire EU framework.
So, as usual, a calm and measured response from the world’s richest man.
Elon has also received support from key U.S. government figures, including Vice President J.D. Vance and Secretary of State Marco Rubio, with the latter labeling the X penalty “an attack on all American tech platforms and the American people by foreign governments.”
So, a pretty chill reaction by senior members of the U.S. administration as well.
Members of the Trump Administration have actually been highly critical of European regulations for some time, with the Trump White House repeatedly signaling that it will take a stronger stand for U.S. businesses in pushing back against what it sees as “unfair” foreign deals, if necessary.
Earlier this year, U.S. Federal Communications Commission (FCC) Brendan Carr said that the EU DSA is “incompatible with America’s free speech tradition,” while VP Vance has heavily criticized similar EU regulations relating to AI innovation. President Trump has also threatened European imports with increasing tariffs in retaliation for regulations that harm U.S. companies, though thus far, the White House hasn’t enacted retaliatory measures on behalf of U.S. tech firms that have been impacted by such EU rules.
Will this case be the one that changes things?
That, ironically, could also be a big win for Meta, a key competitor for Musk, which has also been looking to ingratiate itself with the Trump Administration, in order to win support for its own pushback against EU penalties.
Meta has been hit a lot harder than X on this front, with Meta paying over $US1 billion in EU fines every year, which it has opposed at every turn. Part of Zuck and Co’s reasoning for being more welcoming of Trump, and realigning its systems in line with the Trump team’s demands, has been to get Trump’s backing in such battles, but again, thus far, Trump’s team has stopped short of enacting any trade penalties, or other responses, as a result of EU fines.
But maybe, now that Republican ally Elon Musk is in the firing line, things will be different.
The latest X fine certainly has the attention of Republican senators, and it does seem like Trump will take action, of some kind, to counter the EU ruling.
What form could that response take?
Well, back in August, reports suggested that the State Department was considering various responses to DSA, and its penalties for U.S. companies, including visa restrictions, tariffs, foreign import limits, and more.
But as noted, Trump could, if he wanted to, go even bigger than that, by removing the U.S. from the NATO pact, and severely cutting America’s support for Europe.
That would be extreme, and Trump’s team hasn’t gone anywhere near that as a possible outcome as yet. But some of his supporters are pushing for it, and you can expect the U.S. to enact some form of retaliation to oppose the latest X penalty.
From a broader perspective, the case also serves as an interesting encapsulation of just how significant social media has become in the modern world. Right now, America’s diplomatic relationship with China balances on its efforts to ban TikTok (or not), while its relationship with Europe could be degraded significantly due to X and Facebook.
It sounds crazy, but the next major international conflict could come down to negotiations over social media apps.
Once a frivolous distraction for kids, now a deciding factor in the fate of global harmony.
Expect to see this one heat up before the end of the year.
