Competition regulation Archives | Digital Watch Observatory

Tesla moves to enter the British household electricity market

A licence that would allow Tesla to supply electricity directly to households and businesses across Great Britain has been applied for.

The application was submitted to the national energy regulator Ofgem, which oversees energy suppliers in England, Scotland and Wales.

Approval would enable the company to enter the retail electricity market as early as next year. The service is expected to operate under the brand ‘Tesla Electric’, extending the company’s strategy of combining electric vehicles, battery storage and energy supply into a single ecosystem.

Tesla’s UK energy subsidiary, Tesla Energy Ventures, filed the application through its Manchester-based operation. Regulatory review may take several months, as Ofgem typically requires up to nine months to evaluate electricity supplier licences.

A future electricity offer could primarily target households that already use Tesla technologies, including home batteries and electric vehicle charging systems.

The company sells Powerwall storage batteries in the UK, which allow homeowners to store electricity generated by solar panels or purchased during off-peak hours.

Such systems also allow surplus energy stored in batteries to be sold back to the grid.

Similar services are already available in the US, where Tesla launched a residential electricity supply programme in Texas in 2022.

The expansion into the energy supply market comes amid pressure on Tesla’s automotive business in Europe. Sales of Tesla vehicles in the UK declined significantly during 2025, reducing the company’s share of the national car market.

Diversifying into energy services could therefore represent a broader strategic shift for the company led by Elon Musk. Integrating electricity supply with electric vehicles and home energy systems could allow Tesla to build a more comprehensive energy platform for consumers.

If approved, the initiative would position Tesla as both a technology manufacturer and a direct energy supplier in the British market.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!

EU approves signature of global AI framework

The European Parliament has approved the Council of Europe Framework Convention on Artificial Intelligence, the first international legally binding treaty on AI governance.

With 455 votes in favour, 101 against, and 74 abstentions, Parliament endorsed the EU’s signature to embed existing AI legislation in a global framework. The move reinforces the safe and rights-respecting deployment of AI across the EU and worldwide.

The convention sets standards for transparency, documentation, risk management, and oversight, applying to both public authorities and private actors acting on their behalf.

It establishes a global baseline for AI governance while allowing the EU to maintain higher protections under the AI Act, GDPR, and other EU legislation covering product safety, liability, and non-discrimination.

The EU co-rapporteurs highlighted that the agreement demonstrates the EU’s commitment to human-centric AI. By prioritising democracy, accountability, and fundamental rights, the framework aims to ensure AI strengthens open societies while supporting stable economic growth.

Negotiations on the convention began in 2022 with participation from the EU member states, international partners, civil society, academia, and industry. Current signatories include the EU, the UK, Ukraine, Canada, Israel, and the United States, with the convention open to additional global partners.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!

DIGITALEUROPE urges changes to EU AI Act rules for industry

European industry representatives are urging policymakers to reconsider parts of the EU AI Act, arguing that the current framework could impose significant compliance costs on companies developing AI tools for industrial and medical technologies.

According to Cecilia Bonfeld-Dahl, director-general of DIGITALEUROPE, manufacturers of high-tech machines, medical devices, and radio equipment are already subject to strict product safety regulations. Adding AI-specific requirements could create unnecessary administrative burdens for companies already heavily regulated. She argues that policymakers should aim for balanced AI regulation that encourages innovation while maintaining safety standards.

Industry groups warn that classifying certain AI systems as high-risk under Annex I of the AI Act could be particularly costly for smaller firms. DIGITALEUROPE estimates that a company with around 50 employees developing an AI-based product could incur initial compliance costs of €320,000 to €600,000, followed by annual expenses of up to €150,000. According to the organisation, such costs could reduce profits significantly and discourage smaller companies from pursuing AI innovation.

Manufacturing and medical technology sectors across Europe employ millions of workers and increasingly rely on AI to improve product performance and safety. Industry representatives argue that many applications, such as AI systems used to enhance industrial equipment safety or improve medical devices, already operate under established regulatory frameworks. These existing frameworks could be adapted rather than introducing additional layers of regulation.

The broader regulatory landscape is also contributing to concerns among technology companies. Over the past six years, the EU has introduced nearly 40 new technology-related regulations, some of which overlap or impose similar compliance requirements. DIGITALEUROPE estimates that compliance with the AI Act could cost companies approximately €3.3 billion annually, while cybersecurity and data-sharing regulations add further financial obligations.

Industry leaders warn that rising compliance costs could affect investment in AI development across Europe. Current estimates suggest that the EU accounts for about 7.5% of global AI investment, significantly behind the United States and China.

DIGITALEUROPE has called on the EU institutions to consider postponing parts of the AI Act’s implementation timeline to allow further discussion on how high-risk AI systems should be defined. Supporters of this approach argue that additional consultation could help ensure the regulatory framework protects consumers while also enabling European companies to compete globally in the rapidly evolving AI sector.

Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!

Telegram faces global outages as Russia slows service

Users of the messaging app Telegram have experienced outages in multiple regions over the past 24 hours, with the largest volume of complaints coming from Russia. Reports from the US, UK, Germany, the Netherlands, and Norway suggest the issues could be global.

Difficulties primarily affected the mobile app, with users reporting login issues, messaging delays, and limited access to features. In Russia, outages result from traffic slowdowns by Roskomnadzor, with similar restrictions affecting WhatsApp.

Telegram’s founder, Pavel Durov, has criticised the Russian government’s actions, arguing that authorities aim to push citizens towards a state-controlled alternative, the ‘Max’ messenger.

Despite Telegram overtaking WhatsApp in Russia with over 95 million active users, Max has now surpassed 100 million users, showing the Kremlin’s growing influence over digital communications.

Russian authorities have stated that Telegram must comply with local laws, moderate content, and consider data localisation to avoid further restrictions. Durov has reaffirmed the platform’s commitment to protecting user privacy and upholding freedom of speech.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!

EU charts roadmap for tokenised financial markets

The European Central Bank (ECB) has unveiled Appia, a strategic roadmap for developing Europe’s tokenised financial ecosystem anchored in central bank money. The initiative aims to guide the shift from traditional finance to tokenised markets while ensuring stability and interoperability.

A key component of Appia is Pontes, the Eurosystem’s distributed ledger technology (DLT) settlement solution. Pontes, set for Q3 2026 pilots, will enable central bank money transactions and connect DLT infrastructures with the Eurosystem’s TARGET2, T2S, and TIPS services.

The ECB has opened a public consultation inviting feedback and proposals from both public and private sector stakeholders. Respondents’ input will help refine the roadmap and shape the long-term blueprint for Europe’s tokenised financial system.

Appia also complements ongoing efforts on the digital €, with payment service provider selection planned for 2026 and a 12-month pilot trial in the second half of 2027.

The initiative highlights the ECB’s commitment to integrating emerging technologies while preserving financial stability.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!

UK watchdog demands stronger child safety on social platforms

The British communications regulator Ofcom has called on major technology companies to enforce stricter age controls and improve safety protections for children using online platforms.

The warning targets services widely used by young audiences, including Facebook, Instagram, Roblox, Snapchat, TikTok and YouTube.

Regulators said that despite existing minimum age policies, large numbers of children under the age of 13 continue to access platforms intended for older users.

According to Ofcom research, more than 70 percent of children aged 8 to 12 regularly use such services.

Authorities have asked companies to demonstrate how they will strengthen protections and ensure compliance with minimum age requirements.

Platforms must present their plans by 30 April, after which Ofcom will publish an assessment of their responses and determine whether further regulatory action is necessary.

The regulator also outlined several key areas requiring improvement.

Companies in the UK are expected to implement more effective age-verification systems, strengthen protections against online grooming and ensure that recommendation algorithms do not expose children to harmful content.

Another concern involves product development practices.

Ofcom warned that new digital features, including AI tools, should not be tested on children without adequate safety assessments. Platforms are required to evaluate potential risks before launching significant updates.

The measures are part of the UK’s broader regulatory framework introduced under the Online Safety Act, which aims to reduce exposure to harmful online material.

The law requires platforms to prevent children from accessing content linked to pornography, suicide, self-harm and eating disorders, while limiting the promotion of violent or abusive material in recommendation feeds.

Ofcom indicated that enforcement action may follow if companies fail to demonstrate meaningful improvements. Regulators argue that stronger safeguards are necessary to restore public trust and ensure that digital platforms prioritise child safety in their design and operation.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!

EU competition regulators expand scrutiny across the entire AI ecosystem

Competition authorities in the EU are broadening their oversight of the AI sector, examining every layer of the technology’s value chain.

Speaking at a conference in Berlin, Teresa Ribera explained that regulators are analysing the full ‘AI stack’ instead of focusing solely on consumer applications.

According to the competition chief, scrutiny extends beyond visible AI tools to the systems that support them. Investigations are assessing underlying models, the data used to train those models, as well as cloud infrastructure and energy resources that power AI systems.

Regulatory attention has already reached the application layer.

The European Commission opened an investigation in 2025 involving Meta after concerns emerged that the company could restrict competing AI assistants on its messaging platform WhatsApp.

Following regulatory pressure, Meta proposed allowing rival AI chatbots on the platform in exchange for a fee. European regulators are now assessing the proposal to determine whether additional intervention is necessary to preserve fair competition in rapidly evolving digital markets.

Authorities have also examined concentration risks across other parts of the AI ecosystem, including the infrastructure layer dominated by companies such as Nvidia.

Regulators argue that effective competition oversight must address the entire technology stack as AI markets expand quickly.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!

EU platform law expands data access rights

European regulators are examining how the Digital Markets Act interacts with the General Data Protection Regulation across major digital platforms. The EU rules apply to designated gatekeepers that operate core platform services used by millions of users.

Policy specialists in the EU say the Digital Markets Act complements GDPR protections by strengthening user control over personal data. The framework also supports rights related to data access, portability and transparency for both consumers and business users.

The regulatory overlap affects areas including consent requirements, third-party software installation and interoperability between services. Authorities are also coordinating enforcement between competition and data protection regulators.

Analysts say the combined application of both laws could reshape the responsibilities of major technology platforms. Policymakers aim to increase user choice while reinforcing safeguards for the integrity and confidentiality of personal data in the GDPR.

Would you like to learn more about AI, tech and digital diplomacy? If so, ask our Diplo chatbot!

Leading tech companies deepen AI competition with new capabilities

AI competition among leading AI developers intensified in early 2026 as major companies expanded their models, platforms, and partnerships. Companies including Google, OpenAI, Anthropic, and xAI are introducing new capabilities and integrating AI systems into broader ecosystems.

Google has continued to expand its Gemini model family with updates to Gemini 3.1 Pro and 3.1 Flash, designed to support complex tasks across applications. The company is also integrating Gemini into services such as Docs, Sheets, Slides, and Drive, allowing users to generate documents and analyse data across multiple Google services.

Gemini has also been embedded into the Chrome browser and integrated with Samsung’s Galaxy devices, expanding its distribution across consumer platforms as AI competition among major developers accelerates.

Anthropic has focused on advancing the Claude model family while positioning the system for enterprise and professional use. Recent updates include Claude Sonnet 4.6, which introduces improvements in reasoning and coding capabilities alongside an expanded context window currently in beta. The company has also launched a limited preview of the Claude Marketplace, allowing organisations to use third-party tools built on Claude through partnerships with several software companies.

OpenAI has continued to update ChatGPT with the release of the GPT-5 series, including GPT-5.2 and GPT-5.4. The newer models combine reasoning, coding, and agent-based workflows, while also introducing computer-use capabilities that allow the system to interact with applications directly.

OpenAI has also introduced additional services, including ChatGPT Health and integrations designed to assist with spreadsheet modelling and data analysis, further intensifying AI competition across enterprise and consumer tools.

Meanwhile, xAI has expanded development of its Grok models while increasing computing infrastructure. The company has reported growth in Grok usage through integration with the X platform and other applications. Recent announcements include upgrades to Grok’s voice and multimodal capabilities, as well as continued training of future models.

Across the industry, developers are increasingly positioning their systems not only as conversational assistants but also as tools integrated into enterprise workflows, creative production, and software development. New releases in 2026 reflect a broader shift toward multimodal systems, agent-based capabilities, and deeper integration with existing digital platforms, highlighting how AI competition is shaping the next phase of AI development.

Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!

Anthropic lawsuit gains Big Tech support in AI dispute

Several major US technology companies have backed Anthropic in its lawsuit challenging the US Department of Defence’s decision to label the AI company a national security ‘supply chain risk’.

Google, Amazon, Apple, and Microsoft have filed legal briefs supporting Anthropic’s attempt to overturn the designation issued by Defence Secretary Pete Hegseth. Anthropic argues the decision was retaliation after the company declined to allow its AI systems to be used for mass surveillance or autonomous weapons.

In court filings, the companies warned that the government’s action could have wider consequences for the technology sector. Microsoft said the decision could have ‘broad negative ramifications for the entire technology sector’.

Microsoft, which works closely with the US government and the Department of Defence, said it agreed with Anthropic’s position that AI systems should not be used to conduct domestic mass surveillance or enable autonomous machines to initiate warfare.

A joint amicus brief supporting Anthropic was also submitted by the Chamber of Progress, a technology policy organisation funded by companies including Google, Apple, Amazon and Nvidia. The group said it was concerned about the government penalising a company for its public statements.

The brief described the designation as ‘a potentially ruinous sanction’ for businesses and warned it could create a climate in which companies fear government retaliation for expressing views.

Anthropic’s lawsuit claims the government violated its free speech rights by retaliating against the company for comments made by its leadership. The dispute escalated after Anthropic declined to remove contractual restrictions preventing its AI models from being used for mass surveillance or autonomous weapons.

The company had previously introduced safeguards in government contracts to limit certain uses of its technology. Negotiations over revised contract language continued for several weeks before the disagreement became public.

Former military officials and technology policy advocates have also filed supporting briefs, warning that the decision could discourage companies from participating in national security projects if they fear retaliation for voicing concerns. The case is currently being heard in federal court in San Francisco.

Would you like to learn more about AI, tech, and digital diplomacy? If so, ask our Diplo chatbot!