The European Commission has launched a formal investigation into Elon Musk’s X, escalating global regulatory pressure on the platform after its AI chatbot Grok was linked to the creation of sexually explicit deepfake images of real people.
The probe, announced this week, follows a similar investigation opened in January by UK regulator Ofcom, and could expose X to fines of up to 6 per cent of its global annual turnover under the European Union’s Digital Services Act (DSA).
The Commission said it would assess whether Grok has been used to generate and distribute “manipulated sexually explicit images” to users in the EU, and whether X failed to implement adequate safeguards to prevent the harm.
The investigation also expands an existing DSA case against the platform launched in December 2023, which is examining risks linked to X’s recommender systems – the algorithms that determine what content is pushed to users.
Sexual deepfakes trigger enforcement action
The move comes after campaigners and victims raised alarm about Grok’s ability to generate sexualised images using photographs of real people – a function many said should have “never happened”.
In a previous statement, X’s Safety account said the platform had stopped Grok from digitally altering images to remove people’s clothing in “jurisdictions where such content is illegal”.
Regina Doherty, a member of the European Parliament representing Ireland, said the Commission would examine whether such content had reached EU users.
“There are serious questions over whether platforms such as X are meeting legal obligations to assess risks properly and to prevent illegal and harmful content from spreading,” she said.
“The European Union has clear rules to protect people online. Those rules must mean something in practice, especially when powerful technologies are deployed at scale. No company operating in the EU is above the law.”
The Commission warned it may impose interim measures if X refuses to make “meaningful adjustments” while the investigation is ongoing.
‘Violent, unacceptable form of degradation’
Henna Virkkunen, Executive Vice-President for Tech Sovereignty, Security and Democracy at the Commission, said the probe would test whether X had met its legal obligations.
“With this investigation, we will determine whether X has met its legal obligations under the DSA, or whether it treated rights of European citizens – including those of women and children – as collateral damage of its service,” she said.
She described AI-generated sexual deepfakes as a “violent, unacceptable form of degradation”.
The Grok account on X claimed on Sunday that more than 5.5 billion images were generated by the tool in just 30 days – a scale regulators say raises urgent safety and governance concerns.
Global scrutiny intensifies
Other investigations into Grok are underway in Australia, France and Germany. The chatbot was temporarily banned in Indonesia and Malaysia, although Malaysia has since lifted the restriction.
Ofcom said its UK investigation remains ongoing.
Andrea Simon, Director of End Violence Against Women Coalition, said accountability must extend beyond content takedowns.
“Given the evolving nature of AI-generated harm, the accountability should not stop with X removing content,” she told the BBC.
“We expect the UK government to do more to ensure tech platforms can’t profit from online abuse, like building on the Online Safety Act so it’s fit for purpose.”
Musk pushes back as pressure mounts
Before the Commission’s announcement, Musk posted an image on X that appeared to mock the new restrictions on Grok.
The billionaire has repeatedly criticised regulators and governments scrutinising the tool, particularly in the UK, describing the oversight as “any excuse for censorship”.
The regulatory clash comes just weeks after the EU fined X just shy of AU$200 million over its blue tick verification system, saying it “deceives users” because the platform does not “meaningfully verify” account holders.
That decision sparked a diplomatic response from the United States, with Secretary of State Marco Rubio and the Federal Communications Commission accusing the EU of targeting American firms.
“The European Commission’s 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 said.
His remarks were reposted by Musk, who added: “Absolutely.”
Why this matters for Australia
With parallel investigations now underway locally, the EU’s enforcement move signals that AI safety and platform accountability are shifting from policy debate to regulatory action.
For platforms operating in Australia, the message is clear: algorithmic scale without safeguards now carries legal risk – not just reputational cost.