How Elon Musk and X got into a messy situation in one of its biggest markets

• Elon Musk has been feuding with a Brazilian justice for months over content moderation on X.
• The disagreement has resulted in a nearly $1 million fine to X after it briefly resurfaced this week.
• Earlier this month, Starlink agreed to comply with a ban on access to X in the country.

Elon Musk hasn't shied away from fights since he bought Twitter and renamed it X in 2022.

Musk's approach to content moderation — which he insists is due to his advocacy for free speech — has been challenged in countries like Australia, Nigeria, Turkey, and India.

Now it's led him into a high-stakes conflict with Brazilian Supreme Court Justice Alexandre de Moraes.

Brazil's judiciary branch has dueled with tech companies like WhatsApp and Telegram in the past. However, the disagreement over moderation on X has blown up, leading to threats of arresting X employees and restrictions on other companies owned by Musk.

This week, the Supreme Court of Brazil threw down the latest gauntlet in its war with X: It fined the platform nearly $1 million for briefly resurfacing despite the ban it imposed last month.

The fine comes as Musk's other companies have slowly agreed to comply with the ban.

Earlier this month, Musk's satellite provider, Starlink, agreed to follow court orders to block access to X in Brazil, which has the platform's fifth-largest user population.

Here's a timeline of the international feud:

Brazilian officials crack down on social media censorship

De Moraes started to tighten restrictions on free speech a few years ago when he opened an investigation into "fake news" during former President Jair Bolsonaro's term.

X initially agreed to remove over 100 accounts flagged for hate speech, misinformation, and attacks on democracy while vowing to "challenge the orders legally when possible."

Musk remained vocal about disagreeing with de Moraes' stance, frequently publicizing his concerns about the leader, calling the justice a dictator, and calling for him to "resign or be impeached."

X ignores de Moraes' orders

While X first agreed to adhere to the orders, Musk announced in April that he was reversing the restrictions, saying in a post on X that "principles matter more than profit."

De Moraes responded that Musk would be investigated for obstruction of justice after refusing to remove the accounts. He also said Musk would face a fine of about $20,000 every time an account was reactivated on X, according to a report from French publication AFP.

Justice de Moraes ups the stakes

Musk closed X offices in Brazil on August 17 after de Moraes threatened to arrest an X legal representative, according to a statement from X's Global Affairs team.

X was then banned from Brazil on August 31 after failing to follow orders to name a legal representative for X. De Moraes said the ban would remain in effect until over $3 million in fines were paid and a legal representative was named.

De Moraes also threatened a nearly $9,000 daily fine on any person in the country who attempted to access X with a VPN, which Musk had recommended for users.

Starlink's bank accounts were also frozen in the country on August 29 to help cover X's fines since the companies were linked by Musk's ownership, according to an Associated Press report.

The company provides satellite internet to over 200,000 customers in Brazil.

"This order is based on an unfounded determination that Starlink should be responsible for the fines levied — unconstitutionally —against X," Starlink said in a post on X, adding that it planned to take legal action.

Musk noted in a post on X that SpaceX and X are separate companies with different shareholders, and the move "improperly punishes other shareholders and the people of Brazil."

Starlink agrees to enforce the X ban

After initially refusing to block X, Starlink changed course earlier this month and said it would comply with the order to block X's access in the country.

"Regardless of the illegal treatment of Starlink in freezing of our assets, we are complying with the order to block access to X in Brazil," Starlink said in a post on X.

But Starlink vowed to "pursue all legal avenues" to fight the order.

Starlink's parent company, SpaceX, did not respond to a request for comment from BI.

Brazil's Supreme Court fines X for resurfacing amid ban

Brazil fined X after some of its users were able to access the site on Wednesday, September 18, despite the ban issued in August, according to the BBC.

The company said that its brief restoration was unintended. Hours later, it was blocked again.

Still, the court imposed a fine on the platform of nearly $1 million a day for violating the ban.

Correction: September 20, 2024 — This story has been updated with new information about the fine levied against X in Brazil. It also corrected the last name of the judge. His last name is de Moraes, not Moreas.