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

Elon Musk has been in a months-long dispute with Brazilian Justice Alexandre de Moraes.

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.

But now it’s led him into a high-stakes conflict with Brazilian Supreme Court Justice Alexandre de Moraes.

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

As of Tuesday, Musk’s satellite provider Starlink agreed to follow court orders to block access to X in Brazil, which serves as the platform’s fifth largest population of users.

It’s not clear what will happen next, but professor at FGV Law School in Rio de Janeiro Luca Belli told B-17 he thinks the situation will be solved in a few days once investors start calling Musk.

“I think at some point it will be a little bit difficult to explain that his commitment to absolute freedom of expression is losing millions to investors,” Musk said.

Here’s a timeline of the international feud:

Brazilian officials crack down on social media censorship

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 Justice De Moraes’s stance, frequently publicizing his concerns about the leader and calling the justice a dictator, and calling for him to “resign or be impeached.”

X ignores 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.”

We are lifting all restrictions. This judge has applied massive fines, threatened to arrest our employees and cut off access to 𝕏 in Brazil.

As a result, we will probably lose all revenue in Brazil and have to shut down our office there.

But principles matter more than…

— Elon Musk (@elonmusk) April 6, 2024

Moreas 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 Moreas ups the stakes

Musk closed X offices in Brazil on August 17 after Moreas 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. Moreas said the ban would remain in effect until over $3 million in fines were paid and a legal representative was named.

Moreas 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 until its accounts were frozen, Starlink changed course on Tuesday and said it would comply with the order to block X 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.