X Needs To Pay $5M in Fines Before Brazil Reinstatement

It seems like Elon Musk’s decision to oppose a court order in Brazil is going to be costly for the company, even if it did help Musk underline an ideological point.

Last week, Musk and X agreed to adhere to Brazilian Government requests to censor certain accounts in the app, after initially opposing the order, claiming that it was not legal, and that it violated users’ freedom of speech. Musk also went on the offensive against Brazilian leadership, specifically targeting Brazilian Supreme Court Minister Alexandre de Moraes over what he claims have been repeated illegal demands from the Brazilian court.

The Brazilian Government’s requests relate to ongoing speculation that the 2022 Brazil election was “stolen”, which has been disproven by all investigations into the poll. But Musk, who was a supporter of ousted President Jair Bolsonaro, doesn’t believe that such claims warrant censorship.

But now, after several weeks of X being banned in Brazil, the company has agreed to comply with the court’s requests anyway, while it’s also appointed a local representative, in line with operational requirements.

But even so, X will still have to pay its accumulated fines before it can be reinstated in the region.

As reported by Reuters:

“Brazil's Supreme Court said on Friday that social platform X still needs to pay just over $5 million in pending fines, including a new one, before it will be allowed to resume its service in the country, according to a court document.”

The new fine relates to X apparently using a workaround to enable X access in Brazil, despite the ban. That was quickly rectified, but still, the court’s planning to fine X for the violation.

So X will need to pay $5 million in fines, and when you tack that onto the ad dollars that the company has also lost as a result of the ban, it’s a pretty significant hit for the financially struggling company, and a lot for Musk to eat, purely as a statement piece.

Does that mean that X should have just complied from the start, and avoided the fine?

Well, it depends on how you see it. If Musk and his team truly believe that they’re in the right, and that such requests are in violation of Brazilian law, and X’s “freedom of speech” ethos, then it may be worth taking a stand, in order to underline those principles, and show X users where it stands. It’s a costly exercise, but Musk is, of course, super rich. And as he’s repeatedly stated, money isn’t a primary concern in his mission at X.

If that’s true, then it’s Elon’s call what issues he takes a stand on, though it is interesting that he has chosen to push back against Brazilian demands, yet has complied with similar requests from other nations.

Why is X complying with some Government requests and not others?

Now that is likely the bigger question at play in the broader X project.