The European Commission formally told Elon Musk’s social media platform X (formerly Twitter) on Friday that it believed the company was in breach of the bloc’s tech regulations and could face a fine of up to 6% of its global annual turnover.

It follows an investigation launched last December, with the European Commission’s preliminary findings suggesting that X was breaking Digital Services Act (DSA) rules relating to “dark patterns, advertising transparency and data access for researchers.”

In particular, the Commission criticized X for selling the “blue checkmark” verified status to subscribers “in a way that does not correspond to industry practice and deceives users” by undermining their ability “to make free and informed decisions about the authenticity of the accounts and the content they interact with.”

The Commission said there was “evidence of motivated malicious actors abusing the ‘verified account’ to deceive users.”

X can appeal the preliminary findings before a final decision is made. Thierry Breton, the Commissioner for the Internal Market, said: “If our view is confirmed we will impose fines and require significant changes.”

The social media platform was also criticized for failing to comply with European Union laws requiring transparency over social media advertisements, particularly because “it does not provide a searchable and reliable advertisement repository, but instead put in place design features and access barriers that make the repository unfit for its transparency purpose towards users.”

Thirdly, the Commission criticized the social media platform for failing to provide access to its public data for researchers. X is alleged to do this in two ways, firstly by banning independent access through scraping in its terms of service, and then by making it so difficult for researchers to access its API under research terms that they are left “with no other choice than to pay disproportionally high fees.”

A number of other social media platforms are currently being investigated under the DSA, including TikTok and Meta, which face a similar maximum fine of 6% of their global turnover.

It is not clear how substantial the Commission's fine, if issued, will eventually be. X can argue against the preliminary findings and can also propose its own solutions to any breaches of the regulations.

While Twitter reported revenues of $5.1 billion before being taken into private ownership in 2022 and renamed, the company no longer has to publicly report what its turnover is. Musk himself stated last year that revenues were declining under his leadership.

The social media platform’s press office did not respond to a request for comment.