Meet the guy responsible for helping Meta, Google and Amazon prepare for new laws in Europe
European Union flags flutter outside the EU Commission headquarters, in Brussels, Belgium, February 1, 2023
Yves Herman | Reuters
When Gerard de Graaf moved from Europe to San Francisco almost a year ago, his job had a very different feel to it.
De Graaf, a 30-year veteran of the European Commission, was tasked with resurrecting the EU office in the Bay Area. His title is senior envoy for digital to the U.S., and since September his main job has been to help the tech industry prepare for new legislation called The Digital Services Act (DSA), which goes into effect Friday.
At the time of his arrival, the metaverse trumped artificial intelligence as the talk of the town, tech giants and emerging startups were cutting thousands of jobs, and the Nasdaq was headed for its worst year since the financial crisis in 2008.
Within de Graaf’s purview, companies including Meta, Google, Apple and Amazon have had since April to get ready for the DSA, which takes inspiration from banking regulations. They face fines of as much as 6% of annual revenue if they fail to comply with the act, which was introduced in 2020 by the EC (the executive arm of the EU) to reduce the spread of illegal content online and provide more accountability.
Coming in as an envoy, de Graaf has seen more action than he expected. In March, there was the sudden implosion of the iconic Silicon Valley Bank, the second-largest bank failure in U.S. history. At the same time, OpenAI’s ChatGPT service, launched late last year, was setting off an arms race in generative AI, with tech money pouring into new chatbots and the large language models (LLMs) powering them.
It was a “strange year in many, many ways,” de Graaf said, from his office, which is co-located with the Irish Consulate on the 23rd floor of a building in downtown San Francisco. The European Union hasn’t had a formal presence in Silicon Valley since the 1990s.
De Graaf spent much of his time meeting with top executives, policy teams and technologists at the major tech companies to discuss regulations, the impact of generative AI and competition. Although regulations are enforced by the EC in Brussels, the new outpost has been a useful way to foster a better relationship between the U.S. tech sector and the EU, de Graaf said.
“I think there’s been a conversation that we needed to have that did not really take place,” said de Graaf. With a hint of sarcasm, de Graaf said that somebody with “infinite wisdom” decided the EU should step back from the region during the internet boom, right “when Silicon Valley was taking off and going from strength to strength.”
The thinking at the time within the tech industry, he said, was that the internet is a “different technology that moves very fast” and that “policymakers don’t understand it and can’t regulate it.”
Facebook Chairman and CEO Mark Zuckerberg arrives to testify before the House Financial Services Committee on “An Examination of Facebook and Its Impact on the Financial Services and Housing Sectors” in the Rayburn House Office Building in Washington, DC on October 23, 2019.
Mandel Ngan | AFP | Getty Images
However, some major leaders in tech have shown signs that they’re taking the DSA seriously, de Graaf said. He noted that Meta CEO Mark Zuckerberg met with Thierry Breton, the EU commissioner for internal market, to go over some of the specifics of the rules, and that X owner Elon Musk has publicly supported the DSA after meeting with Breton.
De Graaf said he’s seeing “a bit more respect and understanding for the European Union’s position, and I think that has accelerated after generative AI.”
‘Serious commitment’
X, formerly known as Twitter, had withdrawn from the EU’s voluntary guidelines for countering disinformation. There was no penalty for not participating, but X must now comply with the DSA, and Breton said after his meeting with Musk that “fighting disinformation will be a legal obligation.”
“I think, in general, we’ve seen a serious commitment of big companies also in Europe and around the world to be prepared and to prepare themselves,” de Graaf said.
The new rules require platforms with at least 45 million monthly active users in the EU to provide risk assessment and mitigation plans. They also must allow for certain researchers to have inspection access to their services for harms and provide more transparency to users about their recommendation systems, even allowing people to tweak their settings.
Timing could be a challenge. As part of their cost-cutting measures implemented early this year, many companies laid off members of their trust and safety teams.
“You ask yourself the question, will these companies still have the capacity to implement these new regulations?” de Graaf said. “We’ve been assured by many of them that in the process of layoffs, they have a renewed sense of trust and safety.”
The DSA doesn’t require that tech companies maintain a certain number of trust and safety workers, de Graaf said, just that they comply with the law. Still, he said one social media platform that he declined to name gave an answer “that was not entirely reassuring” when asked how it plans to monitor for disinformation in Poland during the upcoming October elections, as the company has only one person in the region.
That’s why the rules include transparency about what exactly the platforms are doing.
“There’s a lot we don’t know, like how these companies moderate content,” de Graaf said. “And not just their resources, but also how their decisions are made with which content will stay and which content is taken down.”
De Graaf, a Dutchman who’s married with two kids, has spent the past three decades going deep on regulatory issues for the EC. He previously worked on the Digital Services Act and Digital Markets Act, European legislation targeted at consumer protection and rights and enhancing competition.
This isn’t his first stint in the U.S. From 1997 to 2001, he worked in Washington, D.C., as “trade counsellor at the European Commission’s Delegation to the United States,” according to his bio.
For all the talk about San Francisco’s “doom loop,” de Graaf said he sees a different level of energy in the city as well as further south in Silicon Valley.
There’s still “so much dynamism” in San Francisco, he said, adding that it’s filled with “such interesting people and objective people that I find incredibly refreshing.”
“I meet very, very interesting people here in Silicon Valley and in San Francisco,” he said. “And it’s not just the companies that are kind of avant-garde as the people behind them, so the conversations you have here with people are really rewarding.”
The generative AI boom
Generative AI was a virtually foreign concept when de Graaf arrived in San Francisco last September. Now, it’s about the only topic of conversation at tech conferences and cocktail parties.
The rise and rapid spread of generative AI has led to a number of big tech companies and high-profile executives calling for regulations, citing the technology’s potential influence on society and the economy. In June, the European Parliament cleared a major step in passing the EU AI Act, which would represent the EU’s package of AI regulations. It’s still a long way from becoming law.
De Graaf noted the irony in the industry’s attitude. Tech companies that have for years criticized the EU for overly aggressive regulations are now asking, “Why is it taking you so long?” de Graaf said.
“We will hopefully have an agreement on the text by the end of this year,” he said. “And then we always have these transitional periods where the industry needs to prepare, and we need to prepare. That might be two years or a year and a half.”
The rapidly changing landscape of generative AI makes it tricky for the EU to quickly formulate regulations.
“Six months ago, I think our big concern was to legislate the handful of companies — the extremely powerful, resource rich companies — that are going to dominate,” de Graaf said.
But as more powerful LLMs become available for people to use for free, the technology is spreading, making regulation more challenging as it’s not just about dealing with a few big companies. De Graaf has been meeting with local universities like Stanford to learn about transparency into the LLMs, how researchers can access the technology and what kind of data companies could provide to lawmakers about their software.
One proposal being floated in Europe is the idea of publicly funded AI models, so control isn’t all in the hands of big U.S. companies.
“These are questions that policymakers in the U.S. and all around the world are asking themselves,” de Graaf said. “We don’t have a crystal ball where we can just predict everything that’s happening.”
Even if there are ways to expand how AI models are developed, there’s little doubt about where the money is flowing for processing power. Nvidia, which just reported blowout earnings for the latest quarter and has seen its stock price triple in value this year, is by far the leader in providing the kind of chips needed to power generative AI systems.
“That company, they have a unique value proposition,” de Graaf said. “It’s unique not because of scale or a network effect, but because their technology is so advanced that it has no competition.”
He said that his team meets “quite regularly” with Nvidia and its policy team and they’ve been learning “how the semiconductor market is evolving.”
“That’s a useful source information for us, and of course, where the technology is going,” de Graaf said. “They know where a lot of the industries are stepping up and are on the ball or are going to move more quickly than other industries.”
WATCH: Former White House CTO Aneesh Chopra on A.I. regulation
Technology
X lawsuit vs. Apple and OpenAI stays in Fort Worth, Texas; judge suggests they move there
More companies are announcing AI-driven layoffs from Salesforce to Accenture.
Twenty20
From tech to airlines, large global companies have been slashing staff as the real-world impact of artificial intelligence plays out, spooking employees. But critics say AI has become an easy excuse for firms looking to downsize.
Last month, tech consultancy firm Accenture announced a restructuring plan that includes quick exits for workers that aren’t first able to reskill on AI. Days later, Lufthansa said it was going to eliminate 4,000 jobs by 2030 as it leans on AI to increase efficiency.
Salesforce also laid off 4,000 customer support roles in September, saying that AI can do 50% of the work at the company. Meanwhile, fintech firm Klarna has reduced staff by 40% as it aggressively adopts AI tools.
Language-learning platform Duolingo has stated that it will gradually stop relying on contractors and use AI to fill the gaps.
The headlines are grim, but Fabian Stephany, assistant professor of AI and work at the Oxford Internet Institute, said there might be more to job cuts than meets the eye.
Previously there may have been some stigma attached to using AI, but now companies are “scapegoating” the technology to take the fall for challenging business moves such as layoffs.
“I’m really skeptical whether the layoffs that we see currently are really due to true efficiency gains. It’s rather really a projection into AI in the sense of ‘We can use AI to make good excuses,'” Stephany said in an interview with CNBC.
Companies can essentially position themselves at the frontier of AI technology to appear innovative and competitive, and simultaneously conceal the real reasons for layoffs, according to Stephany.
“There might be various other reasons why companies are having to get rid of part of their workforce … Duolingo or Klarna are really prime candidates for this because there has been overhiring during Corona [Covid-19 pandemic] as well,” the professor said.
Some companies that flourished during the pandemic “significantly overhired” and the recent layoffs might just be a “market clearance.”
“It’s to some extent firing people that for whom there had not been a sustainable long term perspective and instead of saying “we miscalculated this two, three years ago, they can now come to the scapegoating, and that is saying ‘it’s because of AI though,'” he added.
This pattern has sparked conversation online. One founder, Jean-Christophe Bouglé even said in a popular LinkedIn post that AI adoption is at a “much slower pace” than is being claimed and in large corporations “there’s not much happening” with AI projects even being rolled back due to cost or security concerns.
“At the same time there are announcements of big layoff plans ‘because of AI.’ It looks like a big excuse, in a context where the economy in many countries is slowing down, despite what the incredible performance of stock exchanges suggest,” said Bouglé, who co-founded Authentic.ly.
Feeding the fear of AI
Jasmine Escalera, a careers expert, said this concealment is “feeding the fear of AI” with employees globally concerned about their jobs being replaced as a result of AI.
“So we already know that employees are scared because companies are not being honest, open and communicative about how they’re implementing AI,” Escalera told CNBC Make It. “Now companies are openly stating ‘We’re doing this [layoffs] because of AI’ so it’s feeding the frenzy.”
Escalera said big companies need to be more responsible as they set the tone for what’s the norm in business decision making and avoid greenlighting “bad behavior.”
A Salesforce spokesperson clarified to CNBC that the company deployed its own AI agent, Agentforce, which reduced the number of customer support cases and eliminated the need to “backfill support engineer roles,” they said.
“We’ve successfully redeployed hundreds of employees into other areas like professional services, sales, and customer success,” the Salesforce spokesperson added.
Klarna directed CNBC to its co-founder and CEO Sebastian Siemiatkowski’s comments on X where he explained that the company shrank its workforce from 5,500 to 3,000 people in two years but “AI is only part of that story.”
Siemiatkowski linked the workforce reduction to slimming down its analytics team to one “success team,” with many then leaving by natural attrition as well as the reduction of the company’s customer success team.
Lufthansa and Accenture declined to comment on the matter and did not share any further details on their AI restructuring strategy. Duolingo did not respond to CNBC’s request for comment.
Mass AI layoffs are not here
The Budget Lab, a non-partisan policy research center at Yale University, released a report on Wednesday which showed that U.S. labor has actually been little disrupted by AI automation since the release of ChatGPT in 2022.
The lab examined U.S. labor market data from November 2022 to July 2025 using a “dissimilarity index” which measured how much the occupational mix—the share of workers in different jobs—has shifted since AI’s debut and compared it to other technological shifts such as the introduction of computers and the internet. It found that AI hasn’t yet caused widespread job losses.
Additionally, New York Fed economists released research in early September which showed that AI use amongst firms “do not point to significant reductions in employment” across the services and manufacturing industry in the New York–Northern New Jersey region.
It found that 40% of service firms said they were using AI this year, up from 25% last year, while manufacturing firms saw a similar jump from 16% last year to 26% this year, but very few were using AI to layoff workers.
Only 1% of the services firm reported AI as the reason for laying off workers in the past six months, down from 10% that had laid off workers using AI in 2024. Meanwhile, 12% of services firms said AI made them hire less workers in 2025.
By contrast, 35% of services firms have used AI to retrain employees and 11% have hired more as a result.
Stephany said there isn’t much evidence from his research that shows large levels of technological unemployment due to AI.
“Economists call this structural unemployment, so the pie of work is not big enough for everybody anymore and so people will lose jobs definitely because of of AI, I don’t think that this is happening on a mass scale,” he said.
He added that concerns about technology putting an end to human work can be seen throughout history.
“It reoccurred this century alone a dozen times, you can go back to ancient times where Roman emperors put hold to certain machines because they were worried about this and always the contrary happened. The machine made companies, industries more productive.
“It allowed for the emergence of entirely new jobs. If you think about the internet 20 years ago, nobody would have known what a social media influencer is, what an app developer is because it didn’t exist.”
Read more about companies conducting AI layoffs below:
Technology
Close to half of Kalshi user base experienced glitches, delays during Saturday college football games
The Kalshi logo arranged on a laptop in New York, US, on Monday, Feb. 10, 2025.
Gabby Jones | Bloomberg | Getty Images
Close to half of Kalshi’s user base experienced glitches and delays on Saturday during college football games, a major source of trades, as some said they were temporarily unable to process orders.
In a message sent to a user obtained by CNBC, the predictions market service’s website apologized for any inconvenience and said it was “looking into” the issues traders were experiencing.
“The Exchange is experiencing temporary delays,” the message read. “Balances and positions may not be accurately reflected at this time.”
One user shared a screen recording and screenshots with CNBC that showed they were unable to see their balance or bets while the issues persisted.
A number of users on X reported the website was down when they were trying to place bets on college football games, with some saying they had open orders that wouldn’t process. When CNBC visited the website, it wouldn’t load, showing only a green K with a spinning circle around it for more than 20 minutes. The platform later loaded.
“Earlier today, Kalshi experienced minor glitches that temporarily affected some user experiences. No exchange outage occurred, no funds were affected, and the issues are now resolved,” the company said in a statement.
Earlier, a spokesperson denied there was an outage and said the exchange “never stopped functioning properly.” He added that there has been no impact on clearing, advanced trading, or institutional trading.
“There were some glitches and delays on our web and app product, which affected less than half of our user base,” the spokesperson said.
A little over a week ago, Kalshi announced a $300 million Series D funding round that valued the company at $5 billion, more than double its $2 billion valuation in June after its Series C round.
The round was co-led by Andreessen Horowitz (a16z) and Sequoia Capital, with participation from Paradigm. Additional backers included Coinbase Ventures, General Catalyst, Spark Capital and CapitalG.
The company, founded in 2018, rose to prominence by offering bettors the ability to trade on a wide range of real-world events, from football games to who President Donald Trump could pardon this year.
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