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EU joins UK regulators in examining $13 bn Microsoft-OpenAI deal

The Commission will carefully review all input received through the calls for contributions…reports Asian Lite News

The European Commission on Tuesday announced to examine whether Microsoft’s $13 billion investment in ChatGPT-maker OpenAI is reviewable under the EU merger regulation.

The EU launched two calls for contributions on competition in virtual worlds and generative artificial intelligence (AI) and sent requests for information to several large digital players.

“We are inviting businesses and experts to tell us about any competition issues that they may perceive in these industries, whilst also closely monitoring AI partnerships to ensure they do not unduly distort market dynamics,” said Margrethe Vestager, Executive Vice-President in charge of competition policy.

Virtual worlds and generative AI are rapidly developing. It is fundamental that these new markets stay competitive, and that nothing stands in the way of businesses growing and providing the best and most innovative products to consumers, she added.

The Commission will carefully review all input received through the calls for contributions.

Following that review, the Commission may organise a workshop in the second quarter of 2024 to bring together all different perspectives emerging from the contributions and continue this reflection.

“In addition, the European Commission is looking into some of the agreements that have been concluded between large digital market players and generative AI developers and providers. The European Commission is investigating the impact of these partnerships on market dynamics,” it said in a statement.

Venture capital investment in AI in the EU is estimated at more than 7.2 billion euros in 2023. The size of the virtual worlds market in Europe is estimated to have reached more than 11 billion euros in 2023.

“Both technologies are expected to grow exponentially in the next years and are likely to have a major impact on how businesses compete,” said the commission.

Last month, the Competition and Markets Authority (CMA) in the UK asked parties and interested third parties to comment on whether the partnership between Microsoft and OpenAI, including recent developments, has resulted in a relevant merger situation and, if so, the impact that the merger could have on competition in the UK.

“The invitation to comment is the first part of the CMA’s information gathering process and comes in advance of launching any phase 1 investigation, which would only happen once the CMA has received the information it needs from the partnership parties,” said Sorcha O’Carroll, Senior Director for Mergers at the CMA.

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