Brazil's Supreme Court lifts 39-day ban on X after compliance and R$28.6M fine

On October 8, 2024, Brazil's Supreme Federal Court (STF) authorized the immediate return of operations for X Brasil Internet Ltda., the company formerly known as Twitter, after a 39-day suspension of its activities in the country. The decision, made by Justice Alexandre de Moraes, comes after the company demonstrated compliance with court orders and paid substantial fines.

The suspension of X Brasil's operations began on August 30, 2024, following repeated non-compliance with judicial decisions issued by the STF. Justice de Moraes ordered the complete and immediate suspension of X Brasil's functioning within national territory until all court orders were fulfilled, fines were paid, and a legal representative in Brazil was appointed.

The ban was a result of X's alleged failure to comply with Brazil's "Marco Civil da Internet," the legal framework governing internet use in the country. This law, enacted in 2014, requires companies operating in Brazil to adhere to local laws, including removing illegal content and providing user data upon judicial request.

The situation escalated on August 17, 2024, when Elon Musk, CEO of X, announced his intention to dissolve X Brasil Internet Ltda., the company's local subsidiary, to avoid complying with Brazilian judicial mandates. The court viewed this as an attempt to evade Brazilian jurisdiction and thwart ongoing investigations.

In response, the STF expanded its enforcement measures to include all entities connected to X in Brazil, encompassing Twitter International Unlimited Company, T.I. Brazil Holdings LLC, and Starlink Brazil Holding Ltda., among others. Musk himself was included as an individual subject to investigation due to his public defiance of Brazilian judicial orders.

Enforcement of the ban

The ban was enforced through a combination of technical and administrative measures:

1. The Brazilian telecommunications agency (ANATEL) coordinated with internet service providers to block access to X's domains and IP addresses.
2. The Central Bank of Brazil froze all financial assets associated with X's entities in Brazil.
3. Brazilian law enforcement agencies monitored compliance among internet service providers.
4. The Ministry of Justice and Public Security coordinated with the judiciary to enforce the ban across different regions of Brazil.
5. Technology companies and financial institutions were notified that facilitating access to X could lead to severe legal consequences.
6. Orders were issued to remove all X-related applications from digital distribution platforms like the Apple App Store and Google Play Store for Brazilian users.

Compliance and resolution

According to the court documents, X Brasil has now met all the conditions set for its return to operations:

1. Blocking of Specific Profiles: The company provided evidence of complying with orders to block several user profiles, including @EdRaposo_, @Claudio061973, @PrJosiasPereir3, @marcosdoval, @DraPaola_, @mveustaquio, @xfischer, @pfigueiredobr2, and @pfigueiredobr03.
2. Legal Representation: On September 20, 2024, X Brasil informed the court that it had filed changes to its corporate structure with the São Paulo State Board of Trade. The company appointed Rachel de Oliveira Villa Nova Conceição as its legal representative in Brazil, fulfilling a key requirement for foreign companies operating in the country.
3. Payment of Fines: On October 4, 2024, X Brasil reported the full payment of fines totaling R$ 28,600,000 (approximately US$ 5.7 million at current exchange rates). This amount included previously imposed fines of R$ 18,300,000, a new fine of R$ 10,000,000, and R$ 300,000 directed to the company's legal representative.

The case highlights the ongoing challenges faced by global social media platforms operating in Brazil. According to Brazilian law, foreign companies must have legal representation in the country and comply with local regulations and court orders.

Justice de Moraes emphasized in his decision that the return of X Brasil's activities was conditioned solely on full compliance with Brazilian legislation and absolute observance of judicial decisions, respecting national sovereignty.

The Attorney General of Brazil, Paulo Gonet Branco, stated on October 8, 2024, that he saw no reason to prevent the company's return to operations. Branco noted that the reasons justifying the August 30 decision no longer persisted, as the previous instances of non-compliance had ceased.

With the suspension lifted, the National Telecommunications Agency (ANATEL) has been instructed to take necessary measures to effectuate X Brasil's return to operations. ANATEL's President, Carlos Manuel Baigorri, has been given 24 hours to communicate the implementation of these measures to the Supreme Court.

This case raises important questions about the balance between freedom of expression and the need to combat disinformation and hate speech on social media platforms. It also underscores the challenges faced by multinational tech companies in navigating different legal and regulatory environments across the globe.

The suspension and subsequent return of X Brasil to operations may have significant implications for:

1. Social Media Regulation: The case could set a precedent for how social media companies are expected to operate and comply with local laws in Brazil and potentially other countries.
2. User Privacy and Content Moderation: The blocking of specific user profiles as part of the compliance process raises questions about the extent of government influence over content moderation on social media platforms.
3. Corporate Governance: The requirement for foreign companies to have legal representation in Brazil and comply with local laws may influence how other tech companies structure their operations in the country.
4. Economic Impact: The 39-day suspension likely had financial repercussions for X Brasil and businesses that rely on the platform for marketing and communication.
5. Public Discourse: The return of X Brasil to full operations may impact public discourse, especially as Brazil approaches municipal elections in 2024.

Key Facts

• Initial suspension date: August 30, 2024
• Return to operations date: October 8, 2024
• Suspension period: 39 days
• Total fines paid: R$ 28,600,000 (approx. US$ 5.7 million)
• Daily fine for VPN usage to access X during ban: BRL 50,000 (approx. USD 10,000)
• Key figures involved: Justice Alexandre de Moraes, Attorney General Paulo Gonet Branco, ANATEL President Carlos Manuel Baigorri, Elon Musk
• Legal representative appointed: Rachel de Oliveira Villa Nova Conceição
• Number of user profiles specifically blocked: 9