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CMA announces new review of UK AI market

The UK’s Competition and Markets Authority (CMA) has announced a probe into the artificial intelligence (AI) market, which is likely to be first of many similar actions taken by authorities across the globe.

The CMA said it would examine competition and consumer protection in the UK’s AI ‘foundation models’ market. Foundation models include large language models and generative AI, like chatbots and image generators. The CMA added that it will scrutinise how these technologies are developing and produce an assessment of “the conditions and principles that will best guide the development of foundation models and their use in the future”.

The initial review will examine how the competitive markets for foundation models and their use could evolve in future, and explore what opportunities and risks these scenarios could bring for competition and consumer protection. The CMA said its findings will then be used to produce guiding principles to “support competition and protect consumers” as AI foundation models develop.

Angelique Bret of Pinsent Masons said: "The launch of a competition review in this area by the CMA is consistent with its focus on digital markets and its commitment to build expertise in this area. It also demonstrates the flexibility of the CMA’s existing powers to conduct this type of review which can lead to a more formal market study and, potentially, an in-depth market investigation.”

“This comes hot on the heels of the landmark Digital Markets, Competition and Consumers Bill that was published last month, which envisages a more specific regime for the regulation of digital markets led by the Digital Markets Unit within the CMA,” Bret said.

The CMA has invited views and evidence from the public for its review. The deadline for submissions is 2 June 2023. The regulator will then publish a report which sets out its findings in September 2023, it said.

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