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EU Assesses Big Tech Cases Ahead of Trump’s Arrival

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The European Commission affirmed on Tuesday that it is proceeding with its investigations into U.S. Big Tech companies, including Apple, Alphabet, X, and Meta, and stressed that President-elect Donald Trump’s return to the White House would not alter its commitment to enforcing European laws. The EU has been at the forefront of examining whether these companies have violated laws designed to prevent them from gaining an unfair advantage over competitors.

Trump, who will begin his second term on Monday, has been critical of several European policies, while his ally Elon Musk has clashed with EU regulators on multiple occasions. Reports surfaced on Tuesday suggesting that Brussels might reassess its ongoing investigations of Big Tech, potentially scaling back or altering the scope of the probes at the request of U.S. companies seeking Trump’s intervention.

However, Henna Virkkunen, the EU commissioner responsible for policy, reassured Reuters that investigations are proceeding as usual and no decisions have been made to suspend them. A spokesperson for the European Commission emphasized that the assessments were routine and unrelated to Trump’s upcoming presidency. The focus of these assessments is on evaluating the progress of cases, the allocation of resources, and the overall readiness of investigations.

U.S. tech companies have long complained that European regulations stifle innovation and impose hefty fines. Meta CEO Mark Zuckerberg recently urged Trump to intervene and prevent further fines from the EU. He likened the EU’s competition enforcement to a “tariff” on U.S. firms. The Digital Markets Act (DMA), Digital Services Act (DSA), and the EU AI Act have drawn particular criticism from tech industry leaders, including Musk, who was scrutinized earlier this month after hosting controversial figures on his X platform.

The EU’s investigations, which can take several years, have already resulted in significant penalties. Last November, Meta was fined nearly 800 million euros ($821 million) for anti-competitive practices. Ongoing investigations into X, Apple, and Alphabet have yet to reach a conclusion.

In the face of criticism, Thierry Breton, the former EU industry chief, urged that the Commission resist efforts to weaken its regulations, asserting that regulation is not censorship.

 

US SEC Sues Elon Musk Over Late Disclosure of Twitter Stake

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The U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Elon Musk on Tuesday, accusing the billionaire entrepreneur of failing to promptly disclose his large stake in Twitter in 2022. The SEC claims Musk violated federal securities laws by delaying the disclosure of his initial purchase of 5% of Twitter’s common shares.

Alleged Violation of SEC Disclosure Rules

According to the SEC’s complaint, Musk took 11 days longer than required to disclose his initial Twitter purchase. Under SEC rules, investors are obligated to file within 10 calendar days once they acquire a 5% stake in a company. In Musk’s case, the deadline was March 24, 2022, but he waited until April 4, 2022, to reveal that he had accumulated a 9.2% ownership stake in the social media platform.

The delay, the SEC argued, allowed Musk to buy over $500 million worth of Twitter shares at artificially low prices, before the public learned of his purchases. This led to a surge in Twitter’s stock price, which rose by more than 27% following Musk’s disclosure.

SEC’s Legal Action

The lawsuit seeks to force Musk to pay a civil fine and return profits that were deemed unearned due to his delayed disclosure. This legal action comes after Musk ultimately acquired Twitter in October 2022 for $44 billion, later rebranding the platform as X.

Musk’s lawyer, Alex Spiro, dismissed the lawsuit as part of a “multi-year campaign of harassment” by the SEC. He argued that the case was based on an administrative failure to file a single form, which, even if proven, would warrant only a minor penalty. Spiro further claimed that Musk had done nothing wrong and that the lawsuit was baseless.

Musk’s Legal Troubles Over Twitter Acquisition

Musk has faced multiple lawsuits related to his Twitter purchase, including another one filed by former Twitter shareholders over the late disclosure. Musk has defended his actions, claiming that the delay was unintentional and that there was no intent to deceive other shareholders.

This latest lawsuit against Musk by the SEC follows a history of contentious interactions between the billionaire and the regulator. In 2018, the SEC sued Musk over his Twitter posts regarding the potential privatization of Tesla. Musk settled the case by paying a $20 million fine and agreeing to have Tesla lawyers pre-approve certain tweets.

In addition to this new lawsuit, Musk has faced other SEC scrutiny, including a request for sanctions after he missed court-ordered testimony related to the Twitter investigation. A federal judge in San Francisco ultimately rejected the SEC’s request for sanctions, as Musk later testified and agreed to cover the SEC’s travel expenses.

Political Timing of the Lawsuit

The lawsuit comes just days before Donald Trump’s second presidential term begins, and some speculate that Musk’s legal battles could be affected by the shift in administration. SEC Chair Gary Gensler, who has clashed with Musk in the past, is stepping down as Trump takes office, with Paul Atkins nominated to replace him. The new leadership at the SEC could potentially review past actions and enforcement measures, including those involving Musk.

Conclusion

The SEC’s lawsuit is another chapter in Musk’s long-standing legal battles with the regulator, centered on his handling of Twitter stock and his broader business ventures. The outcome of the case could have significant implications for Musk’s future dealings with the SEC, particularly concerning timely disclosures of stock purchases.

 

German Defence and Foreign Ministries Depart from Elon Musk’s X

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Germany’s foreign and defence ministries announced on Wednesday that they would shift their public communications away from Elon Musk’s social media platform, X, citing growing dissatisfaction with the platform’s developments. The decision comes amid increasing concerns about Musk’s involvement in European political discourse and the direction the platform has taken since Musk’s acquisition in 2022.

Reasons for Departure

The German ministries did not directly cite Musk’s controversial political interventions but expressed increasing frustration with the platform’s trajectory. The defence ministry spokesperson stated that they had become “increasingly unhappy with developments” on X. While the ministry indicated that it might still use X to counter disinformation, its social communications would now primarily occur via Meta’s WhatsApp messenger.

The foreign ministry also noted that it regularly evaluates the platforms where it maintains a presence and had decided to increase its activity on the emerging platform BlueSky. This marks a shift as the German government seeks to diversify its communication strategies amidst rising concerns about X’s direction under Musk’s leadership.

Musk’s Political Interventions

Musk has faced accusations of meddling in European politics, particularly for his vocal interventions since September. These have included controversial remarks such as calling for the replacement of British Prime Minister Keir Starmer, labeling German Chancellor Olaf Scholz as an “incompetent fool,” and encouraging votes for the far-right Alternative for Germany (AfD). Musk has claimed these statements reflect his stance on issues like immigration, which he believes threaten the future of certain countries.

Although neither ministry directly referenced Musk’s interventions—most recently a live interview with AfD leader Alice Weidel—the growing frustration is likely related to these actions. Critics have voiced concerns that Musk’s political commentary undermines X’s role as a neutral platform for communication.

The Broader Trend

Germany’s departure from X is part of a broader trend of institutions distancing themselves from the platform. In recent weeks, several universities and research institutions in both Germany and the UK have also moved away from X. The departure of such institutions could have a more significant impact on the platform than individual users, as these organizations contribute verified information and help build the “network effects” that make a platform valuable for discussions.

Despite Musk’s claims that user numbers are on the rise since he purchased the platform, recent polls and research studies suggest otherwise, with many questioning the long-term sustainability of X under its current leadership.