TikTok escaped punishment, X must pay. There is a decision of the EC regarding digital giants

The European Commission has imposed a fine of EUR 120 million on Platform X, owned by billionaire Elon Musk, for failing to comply with the Digital Services Act (DSA) in terms of transparency. Chinese TikTok avoided penalties for lack of transparency – the European Commission found that it responded to its comments.

This is the first fine imposed by the Commission on a digital giant since the DSA came into force.

As part of the proceedings against X conducted over the last two years, the EC came to the conclusion that Musk's platform violates three DSA regulations: it misleadingly uses the “blue tick” to verify users, it does not have a transparent advertising repository, and it does not provide data for research in a manner consistent with regulations.

The fine for violating DSA regulations may reach 6%. annual global turnover of a technology company.

Asked whether the fine was high enough to impress Musk, an EU official, speaking on condition of anonymity, noted that The EC has only completed the first of the proceedings against X.

“We do not set the fine based on a potential percentage of the maximum amount we can get, we make it dependent on the severity of the violations. This study focused on transparency. The others, on information manipulation and how to deal with illegal content, are ongoing,” he said.

The United States has repeatedly warned the EU against applying digital regulations to American technology companies. In August, US President Donald Trump threatened tariffs against countries that introduce digital taxes or apply regulations restricting the activities of the so-called big tech.

How is X misleading?

In the Commission's view, X is misleading because it handles its interface for 'verified accounts' with a blue checkmark in a way that is not consistent with industry practice: such 'verified' status can be obtained by anyone who pays for it. The EC found that this negatively impacts users' ability to make informed decisions about the authenticity of the accounts and content they interact with. The commission also faulted the platform for not having a searchable ad repository or making its public data available to researchers under the terms of the DSA.

Earlier, the EC's attention was also drawn to the political activities of X's owner, Musk, in Europe. She looked at, among others: broadcast of an interview that Musk conducted in January with Alice Weidel, leader of the far-right Alternative for Germany (AfD) party. It would be inconsistent with DSA if the platform gave this conversation special visibility among X users.

Musk's cooperation with US President Donald Trump has ended, but the US administration remains highly critical of the EU's digital policy. The EU wants digital giants to take responsibility for the content published on their platforms and not to abuse their dominant market position over smaller companies.

Even before the EC published its decision, US Vice-President JD Vance warned it against imposing a penalty on X. The EU should support freedom of speech and not “attack American companies” for no reason, he wrote.

In August, Trump threatened tariffs on all countries that introduce digital taxes or apply regulations restricting the activities of big tech. At the end of November, US Trade Minister Howard Lutnick announced during a visit to Brussels that the US would address the issue of high US tariffs on steel and aluminum from the EU when the bloc uses his “advice and guidance” on digital policy.

Also on Friday, the European Commission decided to close the proceedings against the Chinese social media platform TikTok regarding advertising transparency. “TikTok has presented a very comprehensive set of commitments that address our concerns,” the Commission said.

However, it is still conducting proceedings against TikTok initiated after the annulment of the first round of the presidential elections in Romania in December 2024. TikTok's policy regarding advertising and paid political content is being investigated. The EC has information provided by the Romanian authorities from declassified intelligence reports.

Large digital companies with a dominant position in the EU market are subject to the Digital Services Act (DSA) and the Digital Markets Act (DMA).

DSA imposes requirements on large digital platforms and search engines, including: in terms of content moderation, the use of algorithms, the fight against disinformation and hate speech, and the labeling of political content. Some of the DSA provisions have been in force in the EU since November 2022. They are fully applicable from February 2024.

From Brussels Magdalena Cedro (PAP)

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