EU slaps X with $140m penalty over transparency violations

The European Union has imposed a major fine on X (formerly Twitter), the social media platform owned by Elon Musk, for violating key transparency rules under its landmark tech law.

The commission has announced a €120 million penalty, roughly $140 million, against the platform.

This marks the first fine issued under the Digital Services Act (DSA), which sets strict standards for online platforms operating in the bloc.

According to the Commission, the decision is linked to several shortcomings, including the platform’s redesigned blue checkmark system, limited transparency in its advertising database, and failure to provide researchers with access to public data.

The ruling places particular focus on the paid blue checkmark feature. Once a symbol used to confirm the authenticity of notable accounts, the badge is now available through subscriptions. 

Regulators said this change can mislead users into believing accounts are verified when no meaningful identity checks have taken place, increasing the risk of impersonation and scams.

While the DSA does not require platforms to verify users, it does ban deceptive design practices. 

The Commission said X’s current system violates that principle by giving a false impression of verification.

The ruling follows an investigation launched in December 2023 into whether X was meeting its obligations to tackle illegal content and misinformation on the platform.