Facing a new attack from the European Union's protectionist extortion racket, X should refuse to comply with any fines and threaten to withdraw from the European marketplace.
There are at least 50 million X users in Europe, and the social media platform is used by many businesses, media outlets and personalities, celebrities, politicians, and others. In turn, the EU is unlikely to be able to withstand a showdown with X. Especially if the Biden or prospective second Trump administration prepares to impose retaliatory tariffs on European exports to the United States.
This bears note in light of a preliminary finding last Friday by the EU Commissioner for Competition Margrethe Vestager that X is in breach of the EU’s Digital Services Act. The commission’s justification for its finding is laughable. It claims, for example, that X’s decision to allow users to purchase blue checkmarks for their accounts "negatively affects users' ability to make free and informed decisions about the authenticity of the accounts and the content they interact with." This is a pitch-perfect example of the EU’s nanny state mentality. Rather than expect users to make careful deliberations about who and what they read or allow a private company to set its own business model, the EU demands that X adopt revenue-losing changes to protect idiots from becoming confused.
The EU additionally warns that X’s advertising transparency and public data sharing are too restrictive. Thierry Breton, the EU commissioner for the internal market, declared that "if our view is confirmed we will impose fines and require significant changes."
There is a deep vein of European arrogance and insecurity driving this policy. The EU despises the fact that an American company is highly popular in Europe and acts outside the EU’s preferred regulatory remits, especially when it comes to X’s generally broad, if not always , latitude for free speech.
Indeed, owner Elon Musk claimed, "The European Commission offered X an illegal secret deal: If we quietly censored speech without telling anyone, they would not fine us. The other platforms accepted that deal. X did not."
Whether Musk’s assertion is true or not, it’s beyond question that EU law and political opinion, as offered by figures such as Vestager and Breton, is antithetical to the U.S. First Amendment tradition. Compared to the U.S., the EU embraces a far more anti-speech predilection on issue areas ranging from defamation and libel to controversial political speech to misinformation to hate speech. Still, the commission's preliminary finding is potentially a big deal for X. The Digital Services Act allows the EU to fine a company up to 6% of its global revenue — a figure that underlines the extortion and revenue concern partly motivating the EU here.
Oddly, or not so oddly, however, it tends to be major American companies that face the EU's excess wrath. The EU has already fined Google $4.5 billion and Apple $2 billion for what it claims are their anti-competitive practices — Vestager recently opened another investigation against Apple. The EU has also launched two offensives against Meta, claiming its Facebook and Instagram operations take insufficient action against disinformation and have unfair subscription models. Vestager has also launched failed actions against other U.S. companies such as Intel, Amazon, and Qualcomm.
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The U.S. government and Congress shouldn’t stand for this situation. Vestager’s Commission for Competition would far more accurately be referred to as the EU Commission for the Protectionist Extortion of U.S. Companies. The EU has made clear that it sees American companies as rich pickings from which to extract revenue and weaken intellectual property protections so that less successful European companies can compete more effectively.
But if the EU wants to continue down this path, the U.S. should find some EU corporate targets from which to take its own pickings.
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