The European Union fined Elon Musk's X €120 million on Friday for breaking its digital rules. The decision immediately drew sharp criticism from Washington.

The investigation into the platform had become a high-profile test of the EU's commitment to regulate Big Tech. Even before the penalty was revealed, US Vice President JD Vance warned the EU against "attacking" US firms through "censorship".

A few hours after Brussels announced the fine, US Secretary of State Marco Rubio also criticised the move.

"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," Rubio wrote on X.

"The days of censoring Americans online are over."

This was the first time the European Commission imposed a content-related fine under its Digital Services Act (DSA).

In a statement, the Commission said X had broken the DSA's transparency rules.

The violations included the misleading design of the blue checkmark for what were supposed to be verified accounts and the platform's failure to let researchers access public data.

"This decision is about the transparency of X", and "nothing to do with censorship," the EU's technology commissioner Henna Virkkunen told reporters as she responded to Washington's criticism.

A day earlier, Vance had posted on X saying the EU "should be supporting free speech, not attacking American companies over garbage", and Musk replied ", Much appreciated".

Musk's platform was the subject of the EU's first formal DSA investigation in December 2023, and the EU found several violations in July 2024.

The EU said that after Musk took charge in 2022, the platform changed its checkmark system so that "anyone can pay" to get a badge of authenticity without X "meaningfully verifying who is behind the account".

"This deception exposes users to scams, including impersonation frauds, as well as other forms of manipulation by malicious actors," the Commission said.

The EU also said X had not been transparent enough about its advertising and had not provided researchers with public data as required by the DSA.

X is still being investigated for how it deals with illegal content and information manipulation.

The first part of the probe had seemed to stall last year. There was no clear movement on a fine.

The EU was also watching developments in the United States, which had changed sharply since 2023 after Trump returned to office this year, with Musk close to him.

Even though they later disagreed, Musk has returned to White House circles, and Brussels had to consider whether a fine on X would increase tensions with Trump.

The DSA allows the EU to impose fines of up to six per cent of a company’s global annual revenue and in X's case the bloc could have looked at Musk's wider business empire, including Tesla.

Brussels chose what many would view as a moderate amount compared to X's influence but Virkkunen said the amount was "proportionate" to the violations.

"We are not here to impose the highest fines," she said.

"We are here to make sure that our digital legislation is enforced," she said. "If you comply with our rules, you do not get a fine, and it is as simple as that."

She also said this decision covered only one part of a very broad investigation into X, which is still going on.

The Centre for Countering Digital Hate advocacy group said the EU move "sends a message that no tech platform is above the laws all corporations have to abide by".

Washington has made its dislike of EU tech rules clear. A new national security strategy released Friday by the Trump administration urged Europe to "abandon its failed focus on regulatory suffocation".

France's digital affairs minister Anne Le Henanff called the decision "historic". "By sanctioning X, Europe shows it is capable of moving from words to action," she said.

Germany's digital minister Karsten Wildberger said the bloc's digital rules "apply to everyone, no matter where they come from".

At the same time, the Commission said it had accepted commitments from TikTok to address concerns about its advertising system.

But the platform, which is owned by a Chinese company, remains under DSA investigation over other issues.