EU lawmakers pass landmark artificial intelligence regulation
Generative AI has been a rare bright spot in a European tech market reeling from declining funding and a pullback in valuations.
Yuichiro Chino | Moment | Getty Images
The European Parliament has approved the bloc’s landmark rules for artificial intelligence, known as the EU AI Act, clearing a key hurdle for the first formal regulation of AI in the West to become law.
The rules are the first comprehensive regulations for AI, which has become a key battleground in the global tech industry, as companies compete for a leading role in developing the technology — particularly generative AI, which can generate new content from user prompts.
What generative AI is capable of, from producing music lyrics to generating code, has wowed academics, businesspeople, and even school students. But it has also led to worries around job displacement, misinformation, and bias.
During a critical Wednesday vote, the Parliament adopted the AI Act with 499 votes in favor, 28 against and 93 abstentions. The regulation is far from becoming law, but it is likely to be one of the first formal rules for the technology globally.
European Parliament members agreed to bring generative AI tools like ChatGPT under greater restrictions. Generative AI developers will be required to submit their systems for review before releasing them commercially.
The Parliament also decided to hold firm with a ban on real-time biometric identification systems, as well as controversial “social scoring” systems.
Human rights campaigners had expressed concern over an attempt by the European People’s Party to water down the ban. Lawmakers nevertheless pressed ahead with it and agreed to prohibit biometric surveillance from all public settings.
The laws have huge implications for developers of generative AI models, such as the Microsoft-backed OpenAI’s ChatGPT and Google’s Bard.
Jens-Henrick Jepenssen, senior director of public policy at Workday, said that the AI Act aims to “build safeguards on the development and use of these technologies to ensure we have an innovation-friendly environment for these technologies such that society can benefit from them.”
“Those are the right goals in my view,” he told CNBC after the vote.
The next stage is for negotiators at EU institutions, such as the EU executive body and 27 member states.
Earlier in the day, Github CEO Thomas Dohmke called on European regulators to listen to the private sector, as it pushed ahead with rules for AI.
“We encourage the European Union and the US government to move really fast and listen to those that built the technology, not only in the commercial business, but also in universities, in the open-source communities,” Dohmke told CNBC’s Arjun Kharpal.
It comes as countries around the world are looking to bring in rules and standards for AI.
On Monday, U.K. Prime Minister Rishi Sunak made a bold pitch to make the U.K. the “geographical home” of AI safety regulation. The government is also gearing up to hold a global summit on AI safety later this year.
WATCH: A.I. regulation is almost trying to move in parallel with innovation, Goldman Sachs says
An Electron rocket launches the Baby Come Back mission from New Zealand on July 17, 2023.
Rocket Lab
Rocket Lab stock soared 8% Monday, building on a strong run fueled by space innovation.
Shares of the space infrastructure company have nearly doubled over the last two months following a slew of successful launches and a deal with the European Union.
The stock is up 63% year to date after surging nearly sixfold in 2024.
Last month, Rocket Lab announced a partnership with the European Space Agency to launch satellites for constellation navigation before December.
Rocket Lab also announced the successful launch of its 66th, 67th and 68th Electron rockets in June. The company successfully deployed two rockets from the same site in 48 hours.
Rocket Lab competes with a growing list of companies in a maturing and increasingly competitive space industry with growing demand. Some of the main competitors in the sector include Elon Musk‘s SpaceX and Firefly Aerospace, which filed its prospectus to go public on Friday.
“For Electron, our little rocket, we’ve seen increased demand over the last couple of years and we’re not just launching single spacecraft — these are generally entire constellations for customers,” CEO Peter Beck told CNBC last month.
He said the company is producing a rocket every 15 days.
Beck, a New Zealand-native, founded the company in 2006. Since its debut on the Nasdaq in August 2021 through a merger with a special purpose acquisition company, the Long Beach, California-based company’s market value has swelled to more than $19 billion.
WATCH: Rocket Lab CEO Peter Beck: One thing I don’t worry about at night is demand
Technology
Anthropic, Google, OpenAI and xAI granted up to $200 million for AI work from Defense Department
A view of the Pentagon on December 13, 2024, in Washington, DC. Home to the US Defense Department, the Pentagon is one of the world’s largest office buildings.
Daniel Slim | Afp | Getty Images
The U.S. Department of Defense on Monday said it’s granting contract awards of up to $200 million for artificial intelligence development at Anthropic, Google, OpenAI and xAI.
The DoD’s Chief Digital and Artificial Intelligence Office said the awards will help the agency accelerate its adoption of “advanced AI capabilities to address critical national security challenges.” The companies will work to develop AI agents across several mission areas at the agency.
“The adoption of AI is transforming the Department’s ability to support our warfighters and maintain strategic advantage over our adversaries,” Doug Matty, the DoD’s chief digital and AI officer, said in a release.
Elon Musk’s xAI also announced Grok for Government on Monday, which is a suite of products that make the company’s models available to U.S. government customers. The products are available through the General Services Administration (GSA) schedule, which allows federal government departments, agencies, or offices to purchase them, according to a post on X.
OpenAI was previously awarded a year-long $200 million contract from the DoD in 2024, shortly after it said it would collaborate with defense technology startup Anduril to deploy advanced AI systems for “national security missions.”
In June, the company launched OpenAI for Government for U.S. federal, state, and local government workers.
WATCH: US needs an allied strategy for AI investment in military and defense: Palantir
Meta CEO Mark Zuckerberg appears at the Meta Connect event in Menlo Park, California, on Sept. 25, 2024.
David Paul Morris | Bloomberg | Getty Images
Meta CEO Mark Zuckerberg on Monday said he plans to invest “hundreds of billions of dollars” into artificial intelligence compute infrastructure, and that Meta plans to bring its first supercluster online next year.
A supercluster is a large, complex computing network that’s designed to train advanced AI models and handle their workloads.
“Meta Superintelligence Labs will have industry-leading levels of compute and by far the greatest compute per researcher,” Zuckerberg wrote in a Facebook post on Monday. “I’m looking forward to working with the top researchers to advance the frontier!”
Zuckerberg said Meta’s first supercluster is called Prometheus, and that the company is building several other multi-gigawatt clusters. One cluster, called Hyperion, will be able to scale up to five gigawatts over several years, he said.
Zuckerberg has been on a multibillion-dollar AI hiring spree in recent weeks, highlighted by a $14 billion investment in Scale AI. He announced a new organization in June called Meta Superintelligence Labs that’s made up of top AI researchers and engineers.
Zuckerberg had grown frustrated with Meta’s progress in AI, especially after the release of its Llama 4 AI models in April received a lukewarm response from developers. He is revamping Meta’s approach to better compete with rivals like OpenAI and Google.
“For our superintelligence effort, I’m focused on building the most elite and talent-dense team in the industry,” Zuckerberg wrote Monday.
WATCH: Meta announces several multi-gigawatt data centers, first planning to come online in 2026
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