The European Union on Friday fined X, the social media company owned by Elon Musk, $140 million for violating one of the bloc’s major laws targeting the technology industry. The case has been seen as a test of European officials’ willingness to aggressively regulate tech companies at risk of antagonizing the Trump administration.
X is the first company to be fined under the European Union’s Digital Services Act, a sweeping law intended to force large internet companies to protect their platforms against manipulation and illicit content. The Trump administration has criticized the policy as an attack on free speech and American tech firms.
Regulators in Brussels said the penalty against X was not about free speech, but the company’s lack of controls to prevent the platform from being abused. That included X’s “deceptive design” that allowed uses to mislead others about their identities, opaque advertising practices and refusal to provide independent researchers with access to public data.
“Deceiving users with blue check marks, obscuring information on ads and shutting out researchers have no place online in the E.U.,” Henna Virkkunen, the executive vice president for tech sovereignty, security and democracy for the European Commission, the European Union’s executive arm, said in a statement. “We are holding X responsible for undermining users’ rights and evading accountability.”
X did not respond to requests for comment. Mr. Musk can appeal the ruling, which could set up a prolonged legal battle.
The 120 million euro fine is modest relative to Mr. Musk’s overall wealth of more than $450 billion. But it landed at a delicate moment for the European Union’s relationship with the United States on issues like the war in Ukraine. The X penalty had been expected to be announced earlier this year, but was delayed during trade negotiations between the European Union and United States.
The fine may not be the last that X faces in the European Union. A second, more far-reaching investigation, is underway into the company’s hands-off approach to policing user-generated content.
Vice President JD Vance criticized the European Union on Thursday ahead of the penalty. “The E.U. should be supporting free speech not attacking American companies over garbage,” Mr. Vance said on X.
Mr. Musk responded to Mr. Vance a few hours later: “Much appreciated.”
The fine came as the European Union has considered dialing back some regulation of the tech industry to encourage economic growth and advancements in areas like artificial intelligence. But officials have said they remain committed to enforcing laws like the Digital Services Act.
The digital law was passed in 2022 to create more oversight of social media, which many European officials blame for exacerbating political divisions and spreading disinformation. The inquiry into X’s practices, which started in 2023, was one of the first major announced cases.
In taking on one of Mr. Musk’s companies, European Union officials have had to account for wider geopolitical considerations. In addition to Mr. Musk’s ties to President Trump, one of his companies, Starlink, provides key satellite communication technology to Ukrainian troops fighting against Russia.
On Friday, after two years of investigation, European regulators said X violated several aspects of the Digital Services Act related to transparency. That included a subscription service offered by X that allows accounts to have a blue check mark, which regulators said deceives people into believing a real verified user is behind the account.
X had also failed to create an adequate public database to know who was behind advertisers on the site, a rule seen as helping the public understand how a social network is being manipulated. The law requires companies to maintain a repository so that sites can be monitored for deceitful practices like scam ads and fake political advertisements.
Regulators said X was also not complying with a rule to give researchers wider access to data that could be used for studying topics like political polarization, disinformation and how content spreads on the platform.
Under the Digital Services Act, fines can be as high as 6 percent of a company’s global annual revenue. X is a subsidiary of Mr. Musk’s privately held artificial intelligence start-up, xAI, which does not publicly disclose its revenue figures.
Adam Satariano is a technology correspondent for The Times, based in London.
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