Microsoft faces a fine in the European Union of up to 1% of its annual revenue if it doesn’t respond to a request for information by May 27. 

The threat stems from a request made under the E.U.’s Digital Services Act concerning the company’s Bing search engine and its associated generative artificial intelligence services.

A post on X.com compelling Microsoft to “provide information under the Digital Services Act on generative AI risks on Bing” was sent on May 17 disclosing the news to the public.

“Bing may pose risks linked to generative AI, such as so-called ‘hallucinations’, deepfakes, as well as the automated manipulation of services that can mislead voters.”

In a linked blog entry from the European Commission’s official website labelled “Daily News,” the Commission explained that the initial request was sent on May 14 “regarding specific risks stemming from Bing's generative AI features, notably “Copilot in Bing” and “Image Creator by Designer.”

The blog post went on to explain that Microsoft “now has until 27 May to provide the requested information to the Commission.”

This warning comes with a notice that the Commission “may impose fines up to 1% of the provider's total annual income” as well as “periodic penalties up to 5% of the provider's average daily income” if the E.U.’s request isn’t met by the deadline.

While a 1% revenue fine might not sound like a crushing blow, in Microsoft’s case that could amount to well over two billion dollars. Its self-reported revenue for 2023 was $211 billion and, if the current market trend remains steady, it’s conceivable that Microsoft could blow past that in 2024. At these numbers, the least the Redmond company would pay, if fined, would be around $2.1 billion.

It bears mention that these fines haven’t yet been levied and that, as of current, Microsoft hasn’t been found guilty of violating any E.U. laws — at least not specifically pertaining to this notice. Instead, this appears to be more of a public-facing courtesy notice that the company has effectively been serviced with a request for further information that bears consequences if ignored.

Cointelegraph reached out to Microsoft for comment but didn’t receive an immediate response.

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