Stock Markets April 30, 2026 05:20 AM

Italy’s Competition Regulator Ends Probes Into Three AI Firms After Binding Promises on Hallucination Risks

AGCM closes investigations after firms agree to clearer user warnings and technical measures to limit inaccurate AI outputs

By Nina Shah
Italy’s Competition Regulator Ends Probes Into Three AI Firms After Binding Promises on Hallucination Risks

Italy's antitrust authority, the AGCM, has closed investigations into three companies developing generative artificial intelligence after accepting legally binding commitments designed to address the risk of AI 'hallucinations'. The firms agreed to permanent disclaimers and clearer disclosures on their chatbot services, while one committed to invest in technology to reduce erroneous outputs.

Key Points

  • Italy's antitrust regulator, the AGCM, closed probes into DeepSeek, Mistral AI SAS and Scaleup after accepting binding commitments.
  • The companies agreed to add permanent disclaimers and better inform users about the risk of AI 'hallucinations' via websites and apps - measures affecting technology and consumer protection sectors.
  • DeepSeek committed to investing in technology to lower hallucination risk; Scaleup's NOVA AI agreed to clarify it provides a single interface to multiple chatbots and does not aggregate or process their outputs.

Italy's competition and consumer protection authority, the AGCM, announced on Thursday that it has concluded inquiries into three companies working with generative artificial intelligence following acceptance of binding undertakings from the firms.

The investigations had focused on alleged unfair commercial practices connected to the possibility that AI systems produce so-called hallucinations, meaning inaccurate or misleading content. The AGCM named the three companies as China-based DeepSeek, France's Mistral AI SAS and Turkey's Scaleup Yazilim Hizmetleri Anonim Şirketi.

According to the regulator, each company committed to improving how they inform users about the risk that their AI systems can generate incorrect or deceptive information. Those measures include adding permanent disclaimers about hallucination risk to the companies' chatbot services and enhancing information available on their websites and within their applications.

The AGCM said that DeepSeek additionally pledged to invest in technology aimed at lowering the likelihood of hallucinations, while acknowledging that current technological solutions cannot remove the risk entirely. This statement underlines that mitigation efforts will be pursued even though complete prevention is not feasible with present systems.

As part of its commitments, the regulator said that NOVA AI - the cross-platform chatbot service provided by Scaleup - will explicitly inform consumers that the service functions as a single interface for accessing multiple chatbots and does not aggregate or further process the individual chatbots' responses. That clarification addresses how the service presents its functionality to end users.

The AGCM has regulatory responsibility for both competition issues and consumer protection, and its announcement indicates the authority used binding commitments to resolve concerns without pursuing further formal measures. The company-specific undertakings are intended to increase transparency for users of chatbot services and to reduce the practical risks associated with incorrect AI-generated content.

Risks

  • Ongoing risk of AI 'hallucinations' persists because companies acknowledge current technology cannot eliminate inaccurate or misleading outputs - this affects users of AI-driven services and the broader technology sector.
  • Potential consumer confusion about how multi-bot interfaces operate if disclosures are incomplete or not prominently presented - this poses a risk to consumer-facing software and online services.
  • Regulatory scrutiny could continue if commitments are not implemented effectively, with implications for firms offering chatbot services and for market trust in generative AI products.

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