Europe Begins Digital Services Act Enforcement with X Fine & TikTok Transparency Commitments

Key Takeaways

• X Fined Under DSA: The European Commission issued a €120 million penalty against X for deceptive “verified” design, advertising transparency gaps, and restricting researcher access to public data.
• Compliance Deadlines Set: X has 60 working days to address the misuse of verification and 90 working days to provide an action plan for improving ad transparency and researcher access.
• TikTok Commitments Accepted: Rather than a penalty, TikTok agreed to binding measures to improve advertising transparency, including full ad content, faster updates and targeting information.
• Implementation Timeline: TikTok must implement new ad transparency features within 2 to 12 months, depending on the requirement.
• Enforcement Era Begins: The actions are the first Digital Services Act enforcement decisions and signal more active oversight of major platforms operating in the EU.

Deep Dive

The European Commission issued its first enforcement actions under the Digital Services Act (DSA) on Wednesday, placing two of the world’s largest platforms on very different tracks toward compliance.

X was fined €120 million after regulators concluded the platform misled users with its paid “verified” badge and failed to meet transparency requirements intended to help watchdogs identify risks such as fraud, disinformation and coordinated manipulation.

Officials said the blue checkmark system, which allows users to pay for a “verified” label without identity confirmation, creates confusion about which accounts can be trusted. The Commission also found that X’s advertising repository lacks key information, including who pays for ads and what those ads contain, and that researchers face barriers when attempting to access public data.

X now has 60 working days to present changes to its verification system and 90 working days to deliver a plan to improve advertising transparency and researcher access. The Commission warned that continued non-compliance could lead to further penalties.

TikTok Agrees to Strengthen Ad Transparency

In a separate decision, the Commission accepted binding commitments from TikTok to strengthen transparency around advertising on its platform. The company agreed to provide the full content of ads as they appear to users, publish information within 24 hours of an ad going live, and disclose how audiences are targeted, including age group, gender and Member State data in aggregated form. Additional search and filtering tools will also be introduced.

TikTok must implement the measures within 2 to 12 months, depending on the requirement. While this closes the portion of the investigation focused on advertising transparency, other elements, including protections for minors and algorithmic design, remain open.

The Commission said both actions reflect the purpose of the DSA, which is to improve scrutiny of online risks and increasing accountability among the largest platforms serving European users.

The GRC Report is your premier destination for the latest in governance, risk, and compliance news. As your reliable source for comprehensive coverage, we ensure you stay informed and ready to navigate the dynamic landscape of GRC. Beyond being a news source, the GRC Report represents a thriving community of professionals who, like you, are dedicated to GRC excellence. Explore our insightful articles and breaking news, and actively participate in the conversation to enhance your GRC journey.