Christian Klein: EU Faces ‘Massive Disadvantage’ in AI Development vs. US

Key Takeaways

• Christian Klein, the CEO of SAP, has warned that overregulation could create an AI disadvantage in the EU.
• He argued that specific AI use cases should be regulated rather than the underlying technology itself.
• Klein joins Mark Zuckerberg and other industry figures in criticizing regulations that restrict AI training.

Critics of EU regulation often point to the United States’ much stronger record for innovation as evidence that the bloc’s legislative red tape suppresses technological progress. 

In the age of AI, such arguments apply not just to the EU’s AI Act, but to various regulations governing how companies use data and distribute digital services.  For instance, calling for a more laissez-faire approach to AI, SAP CEO Christian Klein recently cautioned that overregulation risks creating a “massive disadvantage” for the EU vis-à-vis the U.S. 

SAP Chief Warns Against AI Overregulation

In an interview  with the Financial Times, Klein said he was “totally against” regulating AI. “It would harm the competitiveness of Europe a lot if I can better test my AI models [in the U.S.],” he added.

As the CEO of Europe’s largest software company, Klein said he was “super close” to policy discussions. And despite the note of caution, his overall tone was optimistic. 

“I think the right discussion is happening in Europe right now,” he said. Namely, “don’t regulate the technology. Regulate the outcome.”

AI Act: Impact on EU Developers

While the AI Act was being drafted, there was a split among EU lawmakers. 

On one side were those who aligned with Klein and believed the regulation should govern how AI is used but shouldn’t otherwise restrict developers. On the other hand, there were those who argued that dangerous technology would go unregulated if the Act didn’t lay down explicit rules for developers. 

In the end, the EU settled on a compromise. For the most part, the AI Act deals with specific applications of the technology deemed high-risk. However, Chapter III of the Act sets out specific documentation and assessment obligations for developers of foundation models.

While there have been some criticisms of the AI Act, other areas of EU law are creating a much bigger headache for AI developers.

EU Privacy Law and AI Training

For the European AI industry, legal uncertainties related to the General Data Protection Regulation (GDPR)  and how it applies to AI training pose an ongoing challenge.

Hinting at the issue, Klein warned against the tendency to “over-regulate using data for developing new AI.”  

Meanwhile, other industry figures have been even more outspoken.

In recent months, Meta CEO Mark Zuckerberg has argued that overzealous GDPR enforcement risks creating a hostile environment for AI innovation.

Facing the threat of legal action over its plans to use Facebook and Instagram user data to train AI, Meta has already curtailed its AI ambitions in the EU, cancelling the planned rollout of new products in the region.

About the Author

James Morales

Although his background is in crypto and FinTech news, these days, James likes to roam across CCN’s editorial breadth, focusing mostly on digital technology. Having always been fascinated by the latest innovations, he uses his platform as a journalist to explore how new technologies work, why they matter and how they might shape our future.

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