X gets $140 million EU fine for breaching content rules but TikTok settles

By Foo Yun Chee

BRUSSELS, Dec 5 (Reuters) - Elon Musk's social media company X was fined 120 million euros ($140 million) by EU tech regulators on Friday for breaching online content rules, the first sanction under landmark legislation that once again drew criticism from the U.S. government.

While X did not respond to an emailed request for comment, Musk replied "Bullshit" under a European Commission post about the fine. He also reposted several messages criticising the decision and wrote: "Freedom of speech is the bedrock democracy. The only way to know what you are voting for."

X's rival TikTok staved off a penalty with concessions.

Europe's crackdown on Big Tech to ensure smaller rivals can compete and consumers have more choice has been criticised by the administration of U.S. President Donald Trump, which says it singles out American companies and censors Americans. 

The European Commission, the EU's executive, said its laws do not target any nationality and that it is merely defending its digital and democratic standards, which usually serve as the benchmark for the rest of the world. 

EU TECH CHIEF SAYS FINE IS NOT CENSORSHIP

The EU sanction against X followed a two-year-long investigation under the bloc's Digital Services Act (DSA), which requires online platforms to do more to tackle illegal and harmful content.

The EU's investigation of ByteDance's social media app TikTok led to charges in May that the company had breached a DSA requirement to publish an advertisement repository allowing researchers and users to detect scam advertisements.

The European Commission's tech chief Henna Virkkunen said X's modest fine was proportionate and calculated based on the nature of the infringements, their gravity in terms of affected EU users and their duration. 

"We are not here to impose the highest fines. We are here to make sure that our digital legislation is enforced and if you comply with our rules, you don't get the fine. And it's as simple as that," she told reporters.

"I think it's very important to underline that DSA is having nothing to do with censorship," Virkkunen said.

She said forthcoming decisions on companies which have been charged with DSA violations are expected to take a shorter time than the two years for the X case.

"I'm really expecting that we will do the final decisions now faster," she said. 

VANCE SAYS EU SHOULD NOT ATTACK AMERICAN COMPANIES

U.S. Secretary of State Marco Rubio and U.S. Federal Communications Commission Chairman Brendan Carr denounced the EU's fine.

"The European Commission's $140 million fine isn't just an attack on @X, it’s an attack on all American tech platforms and the American people by foreign governments. The days of censoring Americans online are over," Rubio posted on X.

Carr said on X that the sanction showed Europe fining a successful U.S. tech company for being a successful U.S. tech company.

Meta and TikTok were charged with breaching DSA transparency obligations in October while Chinese online marketplace Temu was accused of violating rules to prevent the sale of illegal products.

X has between 60 to 90 working days to come up with measures to comply with the DSA, with the time frame depending on the issue.

Ahead of the EU decision, U.S. Vice President JD Vance said on X: "Rumors swirling that the EU commission will fine X hundreds of millions of dollars for not engaging in censorship. The EU should be supporting free speech not attacking American companies over garbage." 

TikTok, which pledged changes to its ad library to be more transparent, urged regulators to apply the law equally and consistently across all platforms.

EU regulators said X's DSA violations included the deceptive design of its blue checkmark for verified accounts, the lack of transparency of its advertising repository and its failure to provide researchers access to public data.

The Commission said the investigation into the dissemination of illegal content on X and measures taken to combat information manipulation and a separate probe into TikTok's design, algorithmic systems and obligation to protect children continue.

DSA fines can be as high as 6% of a company's annual global revenue. 

($1 = 0.8579 euros)

(Reporting by Foo Yun Chee, additional reporting by Philip Blenkinsop in Brussels, Katharine Jackson and Doina Chiacu in Washington, Charlotte Van Campenhout in Amsterdam and Bhargav Acharya in Toronto; Editing by Toby Chopra and Louise Heavens)