Jurisdiction

Hong Kong sets a precedent by accepting crypto as proof of assets

Hong Kong has officially recognised cryptocurrency as proof of assets for investment immigration, approving two cases where applicants used Bitcoin and Ethereum to meet the HK$30 million requirement. The latest approval, confirmed on 7 February, marks a significant step in integrating digital assets into the region’s financial and immigration policies.

The first case occurred in October 2024, when a Bitcoin holder successfully proved their wealth for residency. An Ethereum holder has followed suit, with both applicants coming from mainland China. Reports indicate that Invest Hong Kong, the government agency overseeing investment immigration, took a month to review the first case before approving it.

Despite this recognition, it remains uncertain whether direct cryptocurrency investments or crypto ETFs will count towards the required HK$30 million investment within six months of approval. Officials have specified that applicants must store their digital assets securely in cold wallets or on major exchanges such as Binance. With two more applicants under review, Hong Kong appears to be paving the way for broader crypto acceptance in its financial landscape.

South Korea accuses DeepSeek of excessive data collection

South Korea’s National Intelligence Service (NIS) has raised concerns about the Chinese AI app DeepSeek, accusing it of excessively collecting personal data and using it for training purposes. The agency warned government bodies last week to take security measures, highlighting that unlike other AI services, DeepSeek collects sensitive data such as keyboard input patterns and transfers it to Chinese servers. Some South Korean government ministries have already blocked access to the app due to these security concerns.

The NIS also pointed out that DeepSeek grants advertisers unrestricted access to user data and stores South Korean users’ data in China, where it could be accessed by the Chinese government under local laws. The agency also noted discrepancies in the app’s responses to sensitive questions, such as the origin of kimchi, which DeepSeek claimed was Chinese when asked in Chinese, but Korean when asked in Korean.

DeepSeek has also been accused of censoring political topics, such as the 1989 Tiananmen Square crackdown, prompting the app to suggest changing the subject. In response to these concerns, China’s foreign ministry stated that the country values data privacy and security and complies with relevant laws, denying that it pressures companies to violate privacy. DeepSeek has not yet commented on the allegations.

EU AI regulations making it harder for global firms, Ezzat says

Aiman Ezzat, CEO of Capgemini, has criticised the European Union’s AI regulations, claiming they are overly restrictive and hinder the ability of global companies to deploy AI technology in the region. His comments come ahead of the AI Action summit in Paris and reflect increasing frustration from private sector players with EU laws. Ezzat highlighted the complexity of navigating different regulations across countries, especially in the absence of global AI standards, and argued that the EU’s AI Act hailed as the most comprehensive worldwide, could stifle innovation.

As one of Europe’s largest IT services firms, Capgemini works with major players like Microsoft, Google Cloud, and Amazon Web Services. The company is concerned about the implementation of AI regulations in various countries and how they affect business operations. Ezzat is hopeful that the AI summit will provide an opportunity for regulators and industry leaders to align on AI policies moving forward.

Despite the regulatory challenges, Ezzat spoke positively about DeepSeek, a Chinese AI firm gaining traction by offering cost-effective, open-source models that compete with US tech giants. However, he pointed out that while DeepSeek shares its models, it is not entirely open source, as there is limited access to the data used for training the models. Capgemini is in the early stages of exploring the use of DeepSeek’s technology with clients.

As concerns about AI’s impact on privacy grow, European data protection authorities have begun investigating AI companies, including DeepSeek, to ensure compliance with privacy laws. Ezzat’s comments underscore the ongoing tension between innovation and regulation in the rapidly evolving AI landscape.

China targets Apple and Google with antitrust scrutiny, according to Bloomberg

China’s antitrust regulator is reportedly preparing to investigate Apple’s App Store policies and fees, including its 30% commission on in-app purchases and restrictions on external payment services. The move follows recent measures targeting US businesses, including Google and fashion brand Calvin Klein, just as new US tariffs on Chinese goods emerged. Apple’s shares fell 2.6% in premarket trading following the news.

The investigation, led by the State Administration for Market Regulation, comes after ongoing discussions between Chinese regulators, Apple executives, and app developers over the past year. While neither Apple nor the Chinese antitrust regulator has commented on the matter, the move is seen as part of broader scrutiny of US companies operating in China.

In a separate development, Google was also accused of violating China’s anti-monopoly laws, with experts speculating the probe could be linked to Google’s Android operating system and its influence over Chinese mobile manufacturers. Additionally, China’s Commerce Ministry added PVH Corp, the owner of brands like Calvin Klein, to its “unreliable entity” list.

Ex-Google worker indicted for alleged AI espionage

A former Google software engineer faces additional charges in the US for allegedly stealing AI trade secrets to benefit Chinese companies. Prosecutors announced a 14-count indictment against Linwei Ding, also known as Leon Ding, accusing him of economic espionage and theft of trade secrets. Each charge carries significant prison terms and fines.

Ding, a Chinese national, was initially charged last March and remains free on bond. His case is being handled by a US task force established to prevent the transfer of advanced technology to countries such as China and Russia.

Prosecutors claim Ding stole information on Google’s supercomputing data centres used to train large AI models, including confidential chip blueprints intended to give the company a competitive edge.

Ding allegedly began his thefts in 2022 after being recruited by a Chinese technology firm. By 2023, he had uploaded over 1,000 confidential files and shared a presentation with employees of a startup he founded, citing China’s push for AI development.

Google has cooperated with authorities but has not been charged in the case. Discussions between prosecutors and defence lawyers indicate the case may go to trial.

Judge says parts of Musk’s lawsuit against OpenAI could go to trial

A federal judge in California has indicated that some aspects of Elon Musk’s lawsuit against OpenAI may proceed to trial. Musk will be required to testify, with a jury ultimately deciding the outcome. The lawsuit challenges OpenAI’s transition from a nonprofit to a for-profit entity, a move Musk argues contradicts its original mission.

Judge Yvonne Gonzalez Rogers is reviewing Musk’s request to block OpenAI’s conversion before the trial. While she has not yet ruled on the injunction, she suggested Musk’s legal team may need to present more evidence. OpenAI’s lawyers argue that the restructuring is necessary to secure investment and continue developing advanced AI models.

The dispute has intensified as OpenAI seeks billions in funding, which is conditional on its corporate restructuring. Experts note that such nonprofit-to-for-profit transitions are rare, typically occurring in healthcare rather than AI startups. OpenAI maintains that Musk should compete in the market rather than pursue legal action.

EU bans AI tracking of workers’ emotions and manipulative online tactics

The European Commission has unveiled new guidelines restricting how AI can be used in workplaces and online services. Employers will be prohibited from using AI to monitor workers’ emotions, while websites will be banned from using AI-driven techniques that manipulate users into spending money. These measures are part of the EU’s Artificial Intelligence Act, which takes full effect in 2026, though some rules, including the ban on certain practices, apply from February 2024.

The AI Act also prohibits social scoring based on unrelated personal data, AI-enabled exploitation of vulnerable users, and predictive policing based solely on biometric data. AI-powered facial recognition CCTV for law enforcement will be heavily restricted, except under strict conditions. The EU has given member states until August to designate authorities responsible for enforcing these rules, with breaches potentially leading to fines of up to 7% of a company’s global revenue.

Europe’s approach to AI regulation is significantly stricter than that of the United States, where compliance is voluntary, and contrasts with China‘s model, which prioritises state control. The guidelines aim to provide clarity for businesses and enforcement agencies while ensuring AI is used ethically and responsibly across the region.

Belgian watchdog receives complaint over DeepSeek’s data practices

Belgium‘s data protection authority has received a complaint about Chinese AI firm DeepSeek, potentially leading to an investigation. A spokesperson confirmed the complaint but declined to provide further details while the case is being handled.

Regulators in Luxembourg have not received any complaints but are monitoring DeepSeek’s latest AI model, citing potential risks for users. The country’s data protection agency is considering a broader review in collaboration with European regulators.

Authorities across Europe may examine how DeepSeek processes user data. The European Data Protection Board could play a role in assessing the AI company’s compliance with privacy laws.

Trump delays enforcement of TikTok sale deadline

Donald Trump has said there is significant interest in purchasing TikTok, as his administration looks to broker a sale of the Chinese-owned app. The former president posted on Truth Social, stating that such a deal would benefit China and all involved parties.

The fate of TikTok remains uncertain following a US law that requires ByteDance, its Chinese parent company, to sell the app or face a nationwide ban. The law came into effect on 19 January, raising concerns over national security and data privacy.

After taking office, Trump signed an executive order delaying the enforcement of the law by 75 days, allowing more time for negotiations. The move has reignited debate over foreign ownership of technology platforms and their impact on US security.

Belgium plans AI use for law enforcement and telecom strategy

Belgium‘s new government, led by Prime Minister Bart De Wever, has announced plans to utilise AI tools in law enforcement, including facial recognition technology for detecting criminals. The initiative will be overseen by Vanessa Matz, the country’s first federal minister for digitalisation, AI, and privacy. The AI policy is set to comply with the EU’s AI Act, which bans high-risk systems like facial recognition but allows exceptions for law enforcement under strict regulations.

Alongside AI applications, the Belgian government also aims to combat disinformation by promoting transparency in online platforms and increasing collaboration with tech companies and media. The government’s approach to digitalisation also includes a long-term strategy to improve telecom infrastructure, focusing on providing ultra-fast internet access to all companies by 2030 and preparing for potential 6G rollouts.

The government has outlined a significant digital strategy that seeks to balance technological advancements with strong privacy and legal protections. As part of this, they are working on expanding camera legislation for smarter surveillance applications. These moves are part of broader efforts to strengthen the country’s digital capabilities in the coming years.