When reports surfaced in August that Apple had considered buying the French AI startup Mistral, concern was immediately palpable in Brussels.

In the past, the EU has usually allowed takeovers by foreign corporations—such as the acquisition of Arcelor by Mittal Steel—to go through. In an industry with interchangeable production units, this can be economically sensible. However, a different law applies to key technologies like artificial intelligence: Innovation is concentrated in clusters where informal knowledge flows and local networks are crucial.

Economists like Adrien Matray have shown that when companies relocate, they take not only jobs but also the diffusion of knowledge with them. For general-purpose technologies like AI, this means that Europe loses its chance for the next wave of technological breakthroughs.

It would not be the first time that the EU has intervened in antitrust matters. In 2021, Brussels threatened to block Nvidia's acquisition of the British chip designer Arm, arguing that it could stifle innovation flows in key technology areas such as CPUs and autonomous driving.

Apple has good reasons to relocate critical AI expertise to the USA. The company is behind Google, Microsoft, and OpenAI in competition and will seek to integrate talent and research into its own ecosystem. Even if Apple assures Mistral will stay in Europe, such promises are hardly reliable – as Tim Cook's willingness to move production capacities according to US requirements shows.

The EU Commission has a mandate with Mario Draghi's competition report to place more emphasis on innovation. If concrete merger talks occur, Brussels would need to request information, claim jurisdiction, and block if necessary. Because Mistral may not be guaranteed as the next OpenAI – but it is exactly the type of high-risk investment that Europe cannot do without in the AI race.