Microsoft's new deal with France's Mistral AI is under scrutiny from the European Union

LONDON — The European Union is looking into Microsoft's partnership with French startup Mistral AI as part of its broader review of the booming generative artificial intelligence sector to see if it raises any competition concerns.

The 27-nation bloc's executive commission said Tuesday in a brief statement that it's analyzing the agreement between the two companies announced a day earlier. Microsoft declined to comment. Mistral did not respond to a request for comment.

Microsoft said Monday it was teaming up with Mistral through a 15 million euro ($16 million) investment in the French company, which emerged less than a year ago. The agreement could cut the U.S. software giant's reliance on ChatGPT-maker OpenAI for supplying the next wave of chatbots and other generative AI products.

The commission, the EU's top antitrust enforcer, said it's including the deal as part of its broader review of the generative AI market. It's examining agreements between digital tech giants and generative AI developers and providers.

The EU last month started looking into Microsoft’s multibillion deal with San Francisco-based OpenAI, which could lead to a formal merger investigation.