Tech giant Meta Platforms (META) has announced that it will not sign the European Commission’s new Code of Practice for general-purpose AI (GPAI) models. Indeed, Joel Kaplan, Meta’s head of global affairs, shared on LinkedIn that the company believes the EU is taking the wrong approach to AI regulation. He stated that the Code introduces legal uncertainties for AI developers and includes measures that go far beyond what the official AI Act requires. As a result, Meta has decided not to participate.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
- Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week.
Interestingly, other companies have similar concerns about Europe’s regulations. Earlier in the month, around 45 organizations signed a letter asking European Commission President Ursula von der Leyen to delay the implementation of the EU’s AI rules by two years. They argued that the current regulations could hurt Europe’s ability to compete in AI development. Unsurprisingly, Kaplan agreed by saying that this overreach could slow down the progress on cutting-edge AI models and make it harder for European businesses to build on top of them.
It is worth noting that the European Commission introduced the GPAI Code of Practice as a voluntary guide to help companies meet the AI Act’s requirements. In fact, the Code includes copyright protections for content creators, transparency rules for advanced AI models, and documentation guidelines. In addition, the AI Act follows a “risk-based” approach, which means that the more dangerous an AI system could be to society, the stricter the rules will be.
Is Meta a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Strong Buy consensus rating on META stock based on 41 Buys, four Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average META price target of $743.69 per share implies 6.6% upside potential.
