South Korea’s data protection watchdog has announced plans to question Chinese AI startup DeepSeek regarding its handling of user data, following the recent launch of its powerful R1 chatbot.
The Personal Information Protection Commission (PIPC) said Friday that it would formally request details on DeepSeek’s data management practices, with an official confirming that a written inquiry could be submitted as early as the same day. However, no further details were provided.
Global Scrutiny Over DeepSeek’s AI Model
The launch of DeepSeek’s R1 chatbot has sent shockwaves through the tech industry, with the company claiming that its AI matches the capabilities of top American models while operating at a fraction of the cost. This announcement rattled global markets, causing a sharp decline in tech stocks—Nvidia, for instance, plummeted 17% earlier this week.
DeepSeek’s rise has also drawn regulatory attention from several countries. Italy’s Data Protection Agency has launched an investigation and has blocked the R1 model from processing Italian users’ data. Authorities in Italy are particularly concerned about what data the chatbot uses for training and whether it scrapes information from the internet without adequately informing users.
France’s data watchdog, CNIL, has also expressed concerns, stating that it will question DeepSeek to assess the chatbot’s operational framework and potential privacy risks.
AI Market Disruptions and Chip Supply Implications
The Chinese firm has acknowledged using H800 chips—less advanced processors that were permitted for sale to China under U.S. export controls until 2023—to power its AI models.
The emergence of DeepSeek’s technology has had ripple effects in South Korea’s tech sector as well. Major chip manufacturers, including Samsung Electronics and SK Hynix—both key suppliers of high-performance AI chips—saw their stocks tumble when the market reopened Friday after an extended break. Samsung shares dropped over 2%, while SK Hynix plunged nearly 12% at one point.
The growing global scrutiny of DeepSeek underscores rising concerns over AI regulation, data privacy, and the geopolitical competition in artificial intelligence development.
