Microsoft-OpenAI Partnership Will Reportedly Dodge EU Probe

Microsoft will reportedly avoid a formal investigation from the European Commission into its multi-billion partnership with OpenAI. The information comes from two separate reports from Bloomberg and Reuters citing sources familiar with the matter.

Back in January, the European Commission announced that it was investigating Microsoft’s partnership with OpenAI to determine whether it should be considered as an acquisition that should go through the usual regulatory process. The US FTC and the UK CMA also opened similar probes that are still ongoing.

Bloomberg reports that EU regulators have concluded that Microsoft’s $13 billion investment into OpenAI didn’t result in a takeover of the company. Microsoft currently has a non-voting position on the company’s board of directors, and it also has an exclusive license on GPT-4 and other OpenAI models. However, a spokesperson for the EU Commission told Bloomberg that the regulator “first needs to conclude that there has been a change of control on a lasting basis” before opening a formal investigation.

If the Microsoft/OpenAI partnership is still facing regulatory scrutiny in the US and the UK, Microsoft has been partnering with other generative AI startups in recent months. Back in February, the company announced a multi-year partnership with the French company Mistral AI and is now offering access to the company’s AI models to commercial customers, in addition to OpenAI’s.

However, soon after Microsoft announced its partnership with Mistral AI, the EU Commission said that it would be analyzing the agreement between the two companies, suggesting that it could go eventually further than that. This may well push Microsoft to seek partnerships with other generative AI companies to avoid further regulatory scrutiny.