Microsoft, the global computer software giant, has announced its intention to expand its activities in artificial intelligence technology to include Turkey.
This comes as part of a significant agreement between the technology company and G42, a UAE-backed specialized artificial intelligence company, to transfer its operations to the Arab state, marking an unprecedented move in terms of the company’s exit from the United States.
Executive officials at Microsoft stated that the two companies are seeking to transfer these technologies to other markets outside the UAE, including Turkey and Egypt.
This follows a statement by Microsoft’s CEO, Brad Smith, who said that the high-level deal between the company and G42, specializing in artificial intelligence and backed by the UAE, may ultimately involve the transfer of advanced chips and tools. This move, warned by a prominent member of the US Congress, could have national security consequences, according to a Reuters report.
In an interview with Reuters this week, Smith confirmed that the sales agreement, details of which are being revealed for the first time in this report, may move to the second phase, which includes exporting core components of artificial intelligence technology such as model weights, essential for measuring the strength of AI systems.
Smith mentioned that there is no specific timeline for the second phase.
American officials say that artificial intelligence technologies could pose threats to national security, including enhancing the ability to design chemical, biological, and nuclear weapons. In October, the Biden administration asked manufacturers of major artificial intelligence systems to provide information related to them to the US government.
To move forward with this, the deal will require approval from the US Department of Commerce. Executive officials at Microsoft clarified that the agreement includes guarantees to protect Microsoft’s technology and prevent its use by Chinese entities for training AI systems.
However, these measures have not been announced yet, and some members of the US Congress wonder if they are sufficient, according to a report on Al Jazeera’s website.
Some lawmakers are concerned about the secrecy surrounding negotiations between two private companies regarding the terms and guarantees related to the transfer of American technology.
Michael McCaul, the Republican chairman of the House Foreign Affairs Committee, told Reuters: “Despite the significant implications for national security, Congress has not yet received a comprehensive briefing from the executive branch regarding this agreement… I am concerned about the lack of sufficient means to protect sensitive American-origin technology from Chinese espionage, given the interests of the Chinese Communist Party in the UAE.”
The Department of Commerce is currently requesting notifications, and in many areas, also requiring export licenses to send AI chips abroad. However, the Microsoft and G42 deal highlights gaps in US laws as regulatory agencies rush to keep pace with the rapid technological advancements.
Currently, there are no laws regulating the export of AI models. However, McCaul and a group of members from both the Republican and Democratic parties introduced a bill this week that would give US officials clearer authority to regulate this issue.
Executive officials at Microsoft stated that the company welcomes dialogue on a new legal framework to regulate the transfer of artificial intelligence technology, and that the deal with G42 requires the UAE company to comply with US regulations as they evolve.
Smith said: “We are essentially focusing on”Attempt to ensure that American technology can spread safely and smoothly worldwide.” When Microsoft and J42 announced the deal last month, it was indicated that it would bring J42 closer to the United States and enhance American technological influence amid strategic competition with China. Microsoft is investing $1.5 billion in J42, with Smith taking a seat on its board of directors. Both companies did not provide information about the technologies that could be transferred to the UAE or other countries, or any specific security guarantees that would be implemented. The primary goal of this deal is for the two companies to jointly transfer artificial intelligence technology to regions where it is difficult for them to do so individually. Initial examples of this include the deal announced on Wednesday in Kenya. The deal is an agreement between the two companies, requiring each to provide security assurances to their respective governments. However, there is no direct agreement between the United States and the UAE regulating the transfer of sensitive technologies. Officials at Microsoft said the two companies may seek to transfer these technologies to other markets outside the UAE, such as Turkey and Egypt. Smith stated that there are many details of the deal that still need to be addressed, including how to protect what is known as “artificial intelligence model weights,” which are a vital part of an AI model that determines its responses to questions or requests. These weights are obtained by training an AI model using large amounts of data, a process that is often costly. Currently, model weights cannot be encrypted during use, and Smith estimates that promising technical methods to achieve this may take at least a year. Smith said that Microsoft has explored several alternative options to protect its technology, including a system that may involve physically segregating parts of data centers where AI chips and model weights are located, as well as restricting physical access. “I think that when we’re done, we’ll ultimately reach a regulatory framework or approach for monitoring export controls that is widely applicable, not just to Microsoft and J42,” said Smith. Executive officials at Microsoft stated that under the deal, J42 will also commit to a “know your customer” rule to identify users of Microsoft technology, and will not allow Chinese companies to use this technology in training AI models. Regulatory bodies in the United States have proposed a similar rule, but it has not been adopted yet. Talal Al-Qaisi, an executive responsible for AI partnership business at J42, told Reuters, “We made a strategic commercial decision to partner with American companies regarding advanced technologies. We fully understand that to achieve this, we will need to comply with our partners’ requirements and government regulatory requirements or export control regulations.” Microsoft stated that under the agreement, it will have the right to impose financial penalties on J42 and enforce them through arbitration courts in London. Microsoft clarified that this means it will not have to work through the UAE’s legal system to ensure J42 complies with its obligations, and it can seize the company’s assets in many countries if J42 is found to have violated the agreement. It is still not entirely clear how the US Secretary of Commerce, Gina Raimondo, will enable the deal to continue. Smith said that these assessments are “informal” and that “with the current Secretary of Commerce, one can clearly understand whether she approves or rejects something.” A spokesperson for the Department of Commerce stated in a press release that any technology transfer will follow current export controls, including those applicable to AI chips, and any potential future controls. (Turkpress)
