China's star AI startup DeepSeek lands under regulatory microscope worldwide

Governments and regulators are increasing scrutiny of DeepSeek, a Chinese AI startup that claims its models can rival ChatGPT at far lower cost. The AI startup has now moved from being a rising tech name to a growing concern for public authorities. The focus is on data security, privacy rules, and fears that sensitive information could end up in China.

DeepSeek says that it creates advanced AI reasoning models at an affordable price. However, their own privacy policy indicates that they keep user-provided prompts and uploaded files saved to computer servers located in China, causing concern among some nations.

There are warnings from several governments that using DeepSeek exposes sensitive information that may violate laws related to national security.

Governments tightens controls to block DeepSeek’s usage

Australia was one of the first countries to take action against DeepSeek. In early February, it was announced that all government devices would no longer permit access to DeepSeek due to security concerns. The Czech Republic took similar action in July, not allowing any public administration entities to utilize any of DeepSeek’s services due to concerns surrounding data protection.

France revealed in January last year that its privacy watchdog would question DeepSeek to obtain additional information on how the AI startup’s platform works, as well as to ascertain if users were not exposed to potential privacy risks.

Germany took it further as it requested the removal of DeepSeek from Apple and Google stores due to concerns over how data is being handled.

In India, the Ministry of Finance has advised its staff to refrain from utilizing AI tools such as ChatGPT and DeepSeek for their official duties, citing concerns regarding the safety of sensitive documents. South Korea suspended the ability of new users to download the DeepSeek application in February after a representative of DeepSeek admitted to not fully complying with local privacy laws. The ability to download DeepSeek was reinstated in April after modifications to meet the requirements.

The response of Italy towards DeepSeek has been a bit mixed. In January 2025, the regulator in Italy issued blocking orders on the DeepSeek application; however, the Italian regulator later ceased their investigation concerning antitrust issues after DeepSeek came to terms with binding commitments. The Netherlands and Taiwan are currently conducting investigations against DeepSeek.

US officials raise military and chip concerns

In the US, there have been growing concerns within the Trump administration considering imposing restrictions that may prevent the Chinese startup from obtaining technology from American companies. This may also potentially prevent Americans from using DeepSeek’s services altogether.

The US legislature has requested that the Pentagon include DeepSeek in a list of Chinese companies that are purported to be involved with the Chinese military.

A Reuters report quoted a senior US official who claimed DeepSeek “willingly provided and will likely continue to provide support” to China’s People’s Liberation Army.

The same source said the company tried to bypass export controls by using shell firms in Southeast Asia to access restricted AI chips. “This effort goes above and beyond open-source access to DeepSeek’s AI models,” the official said.

Meanwhile, a group of seven Republican Senators has asked the US Department of Commerce to investigate potential data security risks associated with using Chinese-developed open-source AI models like DeepSeek and has intensified pressure on federal regulatory agencies to take further action.

A previous report by Cryptopolitan backs up this concern, highlighting that DeepSeek has far greater affiliation with China’s military and overall surveillance system than they have represented to the public.

The report quotes a senior government official as saying that DeepSeek shares information about its users and private data with the Chinese government.

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