EU says it is probing corporate structure of Musk's X months after xAI deal

(Reuters) -The European Union said on Thursday it was seeking more information from Elon Musk's X about changes to its corporate structure, months after the social media platform was bought by xAI in a $33 billion deal.

"We are following closely changes in the corporate structure of X, as we would changes in any other designated platform," a spokesperson for the European Commission, the EU's executive arm, said.

However, the spokesperson did not confirm an earlier report from Bloomberg News that said regulators were evaluating potential fines on X under the Digital Services Act.

Before its summer recess in August, the regulator could announce a fine on X for alleged infractions under the DSA, though delays are possible, Bloomberg reported.

Representatives for xAI and X did not immediately respond to Reuters requests for comment.

Any firm found in breach of the DSA faces a fine worth up to 6% of its global turnover, and repeat offenders may be banned from operating in Europe altogether.

Earlier this month, X highlighted a disclaimer to its blue checkmark in an attempt to head off a possible hefty fine from EU antitrust regulators.

The Commission issued preliminary findings under the DSA in July last year that X violated rules on deceptive design, especially by turning the blue checkmark into a paid verification, assigning false credibility to users.

X had disagreed with the assessment.

The EU had announced a probe into X's alleged breaches of the DSA in December 2023.

(Reporting by Jaspreet Singh and Niket Nishant in Bengaluru; editing by Diane Craft and David Gregorio)