Over 150 executives from some of Europe’s largest companies, including Renault, Heineken, Airbus, and Siemens, have come together to criticize the recently approved artificial intelligence regulations of the European Union (EU). These companies argue that the AI Act, which was greenlit by the European Parliament on June 14th, could jeopardize Europe’s competitiveness and technological sovereignty. In an open letter addressed to the European Parliament, Commission, and member states, the signatories expressed concerns about the Act’s effectiveness and its potential negative impact on competition.
The executives claim that the current state of the AI Act may stifle Europe’s opportunity to regain its position at the forefront of technological innovation. They believe that the approved rules are overly restrictive and risk undermining the EU’s technological ambitions rather than fostering an environment conducive to AI innovation.
One of the major points of contention for these companies is the legislation’s stringent regulations specifically targeting generative AI systems, a category that often includes “foundation models” like OpenAI’s GPT-4. According to the AI Act, providers of foundation AI models, regardless of their intended use, must register their products with the EU, undergo risk assessments, and meet transparency requirements. These requirements include publicly disclosing any copyrighted data used to train their models.
The signatories argue that complying with these regulations would impose disproportionately high costs and liability risks on companies developing foundation AI systems. They fear that this may lead AI providers to withdraw from the European market altogether. The open letter emphasizes that Europe cannot afford to be left behind and urges EU lawmakers to reconsider the strict compliance obligations for generative AI models. Instead, they propose focusing on a risk-based approach that accommodates broader principles.
Jeannette zu Fürstenberg, a founding partner of La Famiglia VC and a signatory on the letter, asserts that the EU AI Act, as currently formulated, could have catastrophic implications for European competitiveness. She highlights the emerging spirit of innovation in Europe and warns that regulations placing undue burdens on young and innovative companies could jeopardize this progress.
The companies further call for the establishment of a regulatory body comprising AI industry experts to monitor the implementation of the AI Act as technology continues to evolve.
In response to the open letter, Dragoș Tudorache, a Member of the European Parliament who played a leading role in developing the AI Act, expressed disappointment, stating that the signatory companies were reacting based on the influence of a few individuals. Tudorache maintains that the draft legislation provides an industry-led process for defining standards, industry involvement in governance, and a light regulatory regime that prioritizes transparency.
OpenAI, the organization behind ChatGPT and Dall-E, had previously lobbied the EU to amend an earlier draft of the AI Act. OpenAI specifically aimed to remove a proposed amendment that would subject all providers of general-purpose AI systems, including LLMs and foundation models, to the Act’s strictest restrictions. Ultimately, this amendment was not incorporated into the approved legislation.
OpenAI’s CEO, Sam Altman, who had previously warned about the potential dangers of future AI systems, including the possibility of OpenAI leaving the European market, later clarified that the company has no plans to exit the EU despite concerns over compliance with EU regulations.