US seeks to back X in challenge to €120m EU fine

The US government is seeking permission to support Elon Musk and X in their legal challenge against a €120m (£105m) European Union fine, adding a dispute over regulatory jurisdiction to the platform’s battle with Brussels.

According to BBC Business, the US Department of Justice has applied to intervene at the EU’s General Court, arguing that Washington has an interest in how European enforcement affects American digital services. The application is a request to participate in the proceedings, not a ruling on whether the fine should stand.

The European Commission imposed the penalty in December 2025 after finding shortcomings in X’s compliance with the Digital Services Act (DSA). Its decision covered paid verification badges, advertising transparency and researchers’ access to public data.

Washington challenges the reach of enforcement

The justice department is relying on a provision in the statute governing the EU’s Court of Justice that allows a state to intervene if it can demonstrate an interest in a case’s outcome.

Its argument centres on territorial jurisdiction: how far a regulator’s authority extends across borders. Washington wants the Commission’s decisions to remain consistent with international-law understandings of that authority and to avoid harming US-based digital services that make substantial contributions to the American economy.

US Assistant Attorney General Brett A. Shumate said on Thursday that the Commission had improperly sought to extend its authority over American businesses beyond its jurisdiction.

The intervention request follows criticism of the penalty by US Secretary of State Marco Rubio and the Federal Communications Commission. Both had accused the European regulator of targeting or censoring American companies.

Brussels stands by its case

The Commission’s concerns about X’s blue ticks focused on the gap between the impression of verification and the checks actually carried out. It said allowing users to purchase the badge without adequately establishing who operated an account was misleading.

The regulator also found failures involving the visibility of advertising information and access to public data for researchers. The penalty was its first formal finding of non-compliance under the DSA.

Commission spokesperson Thomas Regnier said on Friday that Brussels was prepared to defend the decision and considered its legal case strong. The Commission has rejected suggestions that it singles out businesses because of their nationality, presenting enforcement as protection for European digital and democratic standards.

X also faces separate EU investigations, including scrutiny of its integrated AI assistant Grok over concerns about the creation of sexualised images of real people.

What expanding businesses should take from the dispute

For technology companies entering Europe, the immediate distinction is between a legal challenge and a change in regulatory requirements. Washington’s application does not itself overturn X’s penalty or settle the limits of the Commission’s authority.

The case puts practical product decisions in the compliance spotlight: what a verification badge promises, how advertising information is disclosed and how researchers obtain public data. Businesses assessing EU expansion should examine those features alongside their commercial plans, rather than treating regulation solely as a legal issue after launch.

Companies planning both UK and EU entry should also keep the jurisdictions distinct. This dispute concerns an EU enforcement decision; it does not establish a UK regulatory position. The central issue to watch is whether US participation is permitted and how the court addresses the challenge to the Commission’s decision.