British watchdog says it will not probe Microsoft-Mistral partnership

May 17 (UPI) -- Britain's competition watchdog agency said on Friday that it will not launch an investigation into Microsoft's partnership with French artificial intelligence firm Mistral, saying the arrangements did not meet the threshold for a probe.

Microsoft invested $16 million into Mistral earlier this year for a minority stake, initially sending up flags by Britain's Competition and Markets Authority on whether it qualified as a merger. For the investment, Mistral added its large language models to Microsoft's Azure cloud computing platform.

"The CMA has decided that Microsoft Corporation's partnership with Mistral AI does not qualify for investigation under the merger provisions of the Enterprise Act 2002," the agency said in a brief statement closing its probe.

In April, the CMA invited comments on whether Microsoft's partnership with Mistral constituted a merger and if that merger would substantially limit competition in the market or markets in Britain for goods and services.

Microsoft had fought against having its partnership with Mistral being designated as a merger, despite hiring some Mistral employees in the process. The U.S. tech giant has also hired away employees from another AI firm, Inflection, which has a similar "partnership" deal with Amazon.

The CMA is currently trying to decide if the Amazon-Inflection partnerships should be designated as a merger. The agency gave no indication on when it will rule on that review.