High-stakes AI summit begins in Paris as countries compete for influence

World leaders on Monday gathered in Paris for an artificial intelligence summit co-hosted by French President Emmanuel Macron and Indian Prime Minister Narendra Modi, as countries compete for influence over the rapid development of the technology.

Europe wants to champion its AI industry as it races to keep up with China and the US, which have so far led global development of the technology. US Vice President JD Vance and China’s Vice Premier Zhang Guoqing are among those attending the summit.

"It is high time that we move from science fiction to the real world of applications of AI," Anne Bouverot, Mr Macron's AI envoy, said in an opening speech. "With its unprecedented protection potential, artificial intelligence fuels both immense hopes and at times exaggerated fear."

The summit was launched a day after Mr Macron announced France would invest €109 billion ($112.59 billion) in AI in the coming years. The investment includes a UAE-driven project to build a 1 gigawatt data centre in Europe's biggest AI campus.

At the summit, industry leaders have expressed concern over how to best regulate AI. "We have to ensure that we navigate a difficult path between over-regulation that will kill innovation and free-riding with the risk of AI taking fully taking over humans," said Denis Machuel, chief executive of the Adecco Group, a Swiss-French human resources company.

Senior executives including Google chief executive Sundar Pichai and OpenAI founder Sam Altman are scheduled to speak at the summit.

The summit is expected to include an announcement on Tuesday of an AI foundation with a budget of about €2.5 billion, financed by governments, businesses and philanthropy. "It will be a new fund that will invest in AI infrastructure elements that will be able to irrigate and diversify the AI ecosystem," an Elysee adviser said, without confirming the size of the budget.

On Sunday, UAE AI company G42 and US tech company Microsoft announced the launch of an Abu-Dhabi based AI foundation for the Middle East and the Global South.

European lawmakers last year approved the bloc's AI Act, the world's first comprehensive set of rules governing the technology. Tech giants and some governments have pushed for it to be enforced leniently. The EU is finalising an accompanying code of practice.

In a televised interview on Sunday evening, Mr Macron warned that too much regulation without enough investment would threaten Europe's position in the AI race. "We should not be afraid of innovation," Mr Macron said. "With Mr Modi, we want to work with China and the US but also not depend on anyone."

US Vice President JD Vance arrives in Paris with his wife Usha and their children, before the AI summit in the city. AFP

Mr Macron also pushed back against the idea of banning Chinese AI, days after US politicians introduced a bill to prohibit Chinese company DeepSeek from being used on government devices. The release of its latest high-quality chatbot roiled the markets because it was developed at a far lower cost than its US competitor, ChatGPT.

Mr Vance, who is scheduled to have lunch with Mr Macron on Tuesday, is expected to be at odds with European leaders over the future of tech development. US President Donald Trump's government has pushed for deregulation, as European powers express frustration over what they say is political interference by Elon Musk, who leads the US Department of Government Efficiency.

France this week opened an investigation over allegations that X, the social media company owned by Mr Musk, manipulated its algorithm. A German court ruled that X must provide researchers with access to data to politically related content before the country's federal election.

While you're here

Con Coughlin: To survive, Nato must renew its sense of common purpose

Gavin Esler: Nato summit failed for making news more than it made deals

Simon Waldman: Nato continues to be Ankara’s best security guarantor

The specs: 2018 Nissan Patrol Nismo

Price: base / as tested: Dh382,000

Engine: 5.6-litre V8

Gearbox: Seven-speed automatic

Power: 428hp @ 5,800rpm

Torque: 560Nm @ 3,600rpm

Fuel economy, combined: 12.7L / 100km

Name: Peter Dicce

Title: Assistant dean of students and director of athletics

Favourite sport: soccer

Favourite team: Bayern Munich

Favourite player: Franz Beckenbauer

Favourite activity in Abu Dhabi: scuba diving in the Northern Emirates

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks.

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.

8. Pillar 2 implementation

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

Real estate tokenisation project

Dubai launched the pilot phase of its real estate tokenisation project last month.

The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.

Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.

Lampedusa: Gateway to Europe
Pietro Bartolo and Lidia Tilotta
Quercus

UAE currency: the story behind the money in your pockets