OpenAI violated regulations and was fined 500 million! The official protests as "unreasonable", what happened?

What happened?

The Italian Data Protection Authority (IDPA) has fined OpenAI 15 million euros, believing that the company violated the 'principle of transparency' and its information obligations to users when processing their personal data.

The IDPA survey also found that OpenAI lacks proper age verification mechanisms, leading to the possibility of minors being exposed to content that is not suitable for their age or cognitive development.

In addition to fines, IDPA requires OpenAI to launch a six-month public awareness campaign to enhance the public's understanding of how ChatGPT operates.

The Italian Data Protection Authority fines OpenAI

The Italian Data Protection Authority "IDPA" announced on December 20th that it has fined OpenAI 15 million euros (approximately $15.7 million or 500 million New Taiwan dollars).

IDPA conducted an investigation into the data usage of OpenAI's chatbot ChatGPT and found that the company violated the principle of transparency and its information obligation to users when handling their personal data.

IDPA pointed out that OpenAI used user's personal data during the training of ChatGPT, but did not confirm in advance that this behavior complied with sufficient legal basis. In other words, OpenAI cannot clearly prove that it has the right to use this data to develop models. Furthermore, OpenAI did not explain to the users how their data would be collected, used, and for what purposes.

IDPA's investigation also found that OpenAI does not have a proper age verification mechanism, which may expose minors under the age of 13 to content that is not suitable for their age or cognitive development.

IDPA's punishment for OpenAI includes not only fines, but also a requirement for OpenAI to launch a six-month public awareness campaign to enhance the public's understanding of the operation of ChatGPT, particularly in terms of data collection and user rights. According to IDPA's requirements, OpenAI must promote relevant information to the Italian public through various media channels such as broadcasting, television, newspapers, and the internet.

OpenAI protests unfair punishment

According to Reuters, OpenAI believes the ruling is "disproportionate" and the company will appeal.

In fact, the investigation began in 2023, and IDPA suspected that OpenAI violated EU privacy regulations, temporarily banning the use of ChatGPT in Italy. Later, after OpenAI resolved issues related to user rights, the service was relaunched.

OpenAI stated that IDPA had previously affirmed the company's practices in AI privacy protection. However, the imposed fine is nearly 20 times the revenue generated by OpenAI in Italy during this period, criticizing it as 'diminishing Italy's ambition in the AI industry'.

Reuters noted that despite this, IDPA still believes that the 15 million euro fine is already taking into account OpenAI's cooperation attitude during the investigation, implying that if not, the fine amount may be higher.

After all, according to the General Data Protection Regulation (GDPR) implemented by the European Union in 2018, any non-compliant company may face a maximum fine of 20 million euros or 4% of its global revenue.

[Disclaimer] There are risks in the market, and investment should be cautious. This article does not constitute investment advice, and users should consider whether any opinions, views, or conclusions in this article are suitable for their specific circumstances. Investing based on this is at your own risk.

This article is authorized to be reprinted from: 'Web3+'

Original author: Li Pengrui

Original title: "Fined 500 million yuan for violating data protection regulations, OpenAI protests "unreasonable"! What happened? 》

OpenAI fined 5 billion for violating regulations! Official protests 'unreasonable', what happened? This article was first published in 'Cryptotown'