(Bloomberg) -- Elon Musk’s Twitter Inc. is expected to fall under the European Union’s stricter rules for content moderation despite doubts that the platform was big enough to qualify.

Twitter and the EU’s executive arm are gearing up for the company to be designated a “very large online platform” under the bloc’s new Digital Services Act, according to people familiar with the matter. That means the company has enough monthly active EU users that it will have to report on how it’s reducing harmful posts and could even be forced to change its algorithms by the European Commission. 

For Musk, it means that his stripped-down company will be subject to a much more intrusive regulatory system and could face significant penalties — up to 6% the company’s revenue or even a ban from operating in Europe — if it doesn’t comply. The EU, meanwhile, would avoid the embarrassment of having one of the world’s most influential platforms escape its efforts to tame online content.

Tech companies regardless of their size have to follow the fundamental rules of the DSA and take down illegal content in all the EU’s 27 countries. The EU’s largest platforms — with more than 45 million monthly active users — will be designated as very large online platforms, or VLOPs, and will face centralized, tougher scrutiny by the EU’s executive arm in Brussels. 

Some EU officials had been concerned that Twitter might not have enough users to be designated a VLOP, allowing Musk to dodge the most significant changes to the EU’s content moderation rules. At the end of October before Musk bought the social media site, some internally believed the company would fall short of the 45 million user threshold now that the UK has left the EU, according to former employees familiar with the matter.

Even so, the company prepared for VLOP designation, and was also planning an internal audit to ensure it would be in compliance with DSA regulations, the people said. Staff expected user growth and were concerned that reporting fewer than 45 million monthly active users could affect its reputation among advertisers. 

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Now, Twitter appears likely to hit the 45 million threshold in part because Brussels is looking at a broader definition of active users that could include people who visit the site as well as registered, logged-on users. This could greatly increase the number of users Twitter has in Europe.

Social media sites have until Feb. 17 to report their EU user numbers, after which the executive arm has to designate which sites are very large online platforms. These companies then have until Sept. 1 to follow the DSA’s rules. 

Platforms designated as VLOPs must send annual reports to the commission showing they have enough content moderators in Europe and are restricting the spread of disinformation. They must also open up their algorithms — for example those that determine what content appears at the top of people’s feeds — to regulators for inspection. The executive arm could force companies to change their algorithms or raid their offices. If they don’t comply, the commission could levy huge fines or even ban firms from operating in the EU.

Musk has been trying to reassure the commission for months that he is taking the EU’s content moderation rules seriously. After a recent video call with Internal Market Commissioner Thierry Breton, Musk tweeted that his goals of “transparency, accountability & accuracy of information are aligned” with the EU. He pointed to Twitter’s Community Notes, which allows users to fact-check the service, as one step in that direction.

Musk also has a reputation for changing his mind and a long contentious relationship with US regulators. His mass firings at Twitter and frequent changes to the platform’s rules have concerned both EU and US lawmakers interested in Twitter’s data and privacy practices.

Breton indicated Twitter is on track to comply with the DSA, but that “the next few months will be crucial to transform commitments into reality,” he said in a statement last week.

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