In a landmark ruling that wraps up a three-year regulatory dispute, Australia’s Federal Court has imposed a AUD 650,000 (USD 465,000) penalty on Elon Musk-owned X Corp. for refusing to hand over critical information to the country’s top online safety watchdog about its handling of child sexual exploitation material on its platform. The court also ordered the Texas-based social media giant to cover AUD 100,000 (USD 71,000) in legal costs incurred by the Office of the eSafety Commissioner, with payment required within 45 days of Thursday’s ruling.
The legal conflict dates back to February 2023, when eSafety issued a formal transparency notice to then-Twitter Inc., demanding a public report detailing the company’s actions to curb the spread of child sexual abuse and exploitation content, aligned with Australia’s national Basic Online Safety Expectations. The company was given a March 29, 2023 deadline to submit the completed response, but X failed to provide a report that fully addressed the regulator’s questions. The company ultimately admitted it violated Australia’s 2021 Online Safety Act through this non-compliance.
X’s legal team told the court the non-compliance occurred during a period of significant corporate transition, when Elon Musk completed his high-profile acquisition of the platform and rebranded Twitter as X. The merger between Twitter Inc. and X Corp. closed in March 2023, just weeks after the transparency notice was issued, and X’s legal representative noted the regulator does not claim the violating conduct continued past May 5, 2023.
The long legal battle reached its conclusion after two previous court rulings sided with the regulator: an initial October 2024 judgment upheld by the full Federal Court in July last year confirmed X was legally required to respond to eSafety’s inquiry. Notably, both the regulator and X have agreed the size of the issued fine is appropriate. Christopher Tran, the lead lawyer for eSafety, told reporters the penalty was set at this level specifically because of X’s status as a large global corporation. He emphasized that a significant penalty was necessary to avoid treating regulatory violations as just a routine cost of doing business for large tech firms.
eSafety Commissioner Julie Inman Grant, a former Twitter employee herself, framed the ruling as a critical win for corporate accountability in the tech sector. “In early 2023, we asked some of the world’s biggest technology companies, including Twitter, to report on steps they were taking to comply with the Australian Basic Online Safety Expectations in relation to the proliferation of child sexual exploitation and abuse materials on their platforms,” Inman Grant said in a post-ruling statement. She added, “This is not only a key part of our work as Australia’s online safety regulator, it also provides the Australian public with important information about how these companies are tackling the worst-of-the-worst content on their platforms.”
As of Thursday, X had not issued any immediate public response to requests for comment on the court’s ruling.