Meta (NASDAQ: META), alongside over 50 leading companies including SAP and Spotify, is pushing back on the European Union’s (EU) approach to regulating artificial intelligence (AI). In an open letter, backed by Meta and other major players, the consortium asserts that the EU’s fragmented and inconsistent regulatory actions risks stifling innovation, leaving Europe at a competitive disadvantage in the global AI race.

At the heart of the letter is a strong plea for regulatory reform that ensures clarity and harmonization across the EU’s single market, warning that the current uncertainty surrounding AI regulations threatens the region’s economic growth and technological leadership.

This coalition of tech giants and researchers calls on European policymakers to rethink their approach to AI, urging them to modernize and streamline existing regulations such as the General Data Protection Regulation (GDPR) to better align with the rapid advancements in AI technologies.

With billions of euros and Europe’s technological future at stake, Meta and its allies have made it clear: unless the EU reforms its regulatory framework, the region could be left behind.

The Fight for Open and Multimodal AI Models

Meta is spearheading the campaign for regulatory certainty in Europe. The company’s primary concern revolves around the EU’s fragmented regulatory approach, which threatens the future of AI innovation, particularly in the development of open and multimodal models. These models, which allow AI systems to process and integrate text, images, and speech, represent the next frontier of AI technology.

In the open letter, Meta and its co-signers argue that without clear rules allowing the use of European data to train these advanced models, Europe risks missing out on AI’s transformative potential. Open models, freely available for modification and use by businesses, researchers, and public institutions, are seen as crucial for driving productivity, scientific discovery, and economic growth.

According to Meta and its partners, these models can add hundreds of billions of euros to Europe’s economy and allow smaller companies access to cutting-edge tools they otherwise couldn’t afford to develop.

The letter points out that AI innovations powered by these open models are already accelerating medical research, helping preserve cultural heritage, and enabling startups to compete on a global stage. However, if Europe continues down the path of regulatory uncertainty, AI advancements will likely migrate to regions with clearer frameworks, such as the U.S. and China, leaving Europeans deprived of these benefits.

“Regulatory decision making has become fragmented and unpredictable, while interventions by the European Data Protection Authorities have created huge uncertainty.”

The GDPR Dilemma: Balancing Privacy and Progress

One of the key regulatory challenges outlined in the letter is the European Data Protection Authorities’ interpretation of the GDPR in the context of AI. While the GDPR has been praised for setting a global standard in data privacy, Meta and its allies argue that its rigid application to AI models creates uncertainty and hampers innovation.

Inconsistent rulings across member states have made it difficult for companies to know what kinds of data can be used for AI training. Meta, which relies heavily on data to develop its AI systems, is particularly concerned about these regulatory hurdles. The tech giant argues that for Europe to remain competitive, policymakers must modernize the GDPR’s provisions in a way that preserves privacy while allowing for the responsible development of AI technologies.

Meta and its co-signers emphasize that the EU must reassert its commitment to regulatory harmonization, as established in frameworks like the GDPR. A fragmented approach not only contradicts the spirit of the single market but also makes it difficult for companies to scale AI innovations across borders. For Meta and other leading tech companies, regulatory certainty is crucial for investing in AI in Europe.

Big Tech’s Warning: The Economic Costs of Inaction

Without decisive action to reform AI regulations, the region risks being sidelined in the AI revolution, with significant economic consequences.

Research cited in the letter suggests that generative AI could increase global GDP by 10% over the next decade. Meta and its partners argue that Europe should not be excluded from this economic windfall. AI’s potential to turbocharge productivity, drive innovation, and foster new industries could be a major driver of growth for the EU. However, this potential will only be realized if regulatory barriers are removed and the EU fosters an environment conducive to AI development.

Meta’s broader argument is that the EU’s current regulatory approach, particularly around data usage, is inhibiting Europe’s ability to compete with the U.S., China, and India, all of which have more permissive frameworks for AI innovation. These countries are attracting the talent, investment, and resources necessary to drive AI breakthroughs, while Europe’s fragmented regulations create uncertainty and hesitation.

The Wrap

Meta’s open letter, supported by a broad coalition of companies, marks a significant pushback against the EU’s current approach to AI regulation. The tech giants are urging European policymakers to recognize the risks of regulatory fragmentation and take swift action to provide the clarity and consistency needed to foster AI innovation across the region.

The letter highlights a stark choice for Europe: either reform its AI regulatory framework to embrace open models, foster innovation, and unlock economic growth, or continue down the path of uncertainty and stagnation.

Meta’s message is clear: Europe must act now, or risk being left behind in the AI era.