What happened?

  • The Italian Data Protection Authority 'IDPA' imposed a fine of 15 million euros on OpenAI, believing that the company violated the 'transparency principle' and its information obligations to users when handling personal data.

  • The IDPA investigation also found that OpenAI did not have appropriate age verification mechanisms, leading to the possibility that minors could be exposed to content unsuitable for their age or cognitive development.

  • In addition to the fine, the IDPA requires OpenAI to undertake 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 20 that it has imposed a fine of 15 million euros (approximately 15.7 million USD or 500 million TWD) on OpenAI.

The IDPA is investigating OpenAI's data usage concerning its chatbot ChatGPT, believing that the company violated the 'transparency principle' and its information obligations to users when handling personal data.

The IDPA pointed out that OpenAI used users' personal data in training ChatGPT but did not confirm in advance that such actions were based on sufficient legal grounds. In other words, OpenAI cannot clearly demonstrate that it has the right to use this data to develop models. Furthermore, OpenAI did not explain to users how their data would be collected, used, and for what purposes.

The IDPA's investigation also found that OpenAI did not have appropriate age verification mechanisms, leading to the possibility that minors under 13 could be exposed to content unsuitable for their age or cognitive development.

The IDPA's punishment against OpenAI, in addition to the fine, also requires OpenAI to undertake a six-month public awareness campaign to enhance the public's understanding of how ChatGPT operates, particularly regarding data collection and user rights. According to the IDPA's requirements, OpenAI must promote relevant information to the Italian public through various media channels, including radio, television, newspapers, and the internet.

OpenAI protests the penalty as unreasonable

According to (Reuters) reports, OpenAI believes the ruling is 'disproportionate' and the company will appeal.

In fact, the investigation began in 2023, and the IDPA had suspected OpenAI of violating EU privacy regulations, temporarily banning the use of ChatGPT in Italy. Later, after OpenAI addressed user rights-related issues, the service was brought back online.

Regarding this fine, OpenAI stated that the IDPA had previously acknowledged the company's practices in AI privacy protection; however, the current fine amount is nearly 20 times OpenAI's revenue in Italy during this period and criticized this move as 'undermining Italy's ambitions in AI industry development.'

(Reuters) pointed out that nevertheless, the IDPA still believes that the 15 million euro fine has already considered OpenAI's cooperative attitude during the investigation process, suggesting that if not for that, the fine amount could have been higher.

After all, according to the (General Data Protection Regulation) (GDPR) implemented by the European Union in 2018, any violating company may face fines of up to 20 million euros or 4% of global revenue.

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  • This article is reprinted with permission from: (Web3+)

  • Original author: Li Pengrui

  • Original title: (Fined 500 million for violating data protection regulations, OpenAI protests 'unreasonable'! What happened?)

'OpenAI fined 500 million for violating regulations! Official protests 'unreasonable', what happened?' This article was first published in 'Crypto City'.