1. Piercing the corporate veil is a thing,
2. Especially when Musk does it so often himself.
The EU was not likely to do this if Musk had not set the precedence himself by, among other things, taking NVDA chips from Tesla and redirecting them to xAI, using Tesla engineers at Twitter, telling Tesla's board that unless they paid him more (i.e. replace the shares he sold to buy Twitter) he would start new projects at other companies (like he did with xAI), borrowing money from one company (SpaceX) to buy another company (Twitter), using cash from one business (SpaceX) to directly finance another business (SolarCity) by buying its equity, merging one failing company (SolarCity) into another (Tesla) to bail it out, and that is just from memory, I am probably missing some.
If the EU goes forward it will only be to follow Musk's footsteps.