China expands AI market share in Europe amid new export controls

A study by the Friedrich Naumann Foundation for Freedom reveals that Chinese AI models have significantly increased their market share in Europe. On the developer platform OpenRouter, Chinese models accounted for 61 percent of token consumption in Germany and 58 percent across the EU during July and August 2026, a sharp rise from approximately 15 percent the previous year.

Experts note that while models from providers like Alibaba and DeepSeek are more affordable and closing the performance gap with US competitors, this shift creates dependencies on Beijing. Concerns were raised regarding high switching costs, data privacy, and cybersecurity risks. The study suggests that Chinese restrictions may impact European and US users more heavily than US restrictions impact China.

Simultaneously, China's Ministry of Commerce and Ministry of Science and Technology have released a draft to tighten export controls on AI technologies. The proposed catalog targets 23 key technologies, including large-scale models, agents, and computing clusters. The regulations would prohibit the export of AI capable of generating malicious code to attack critical infrastructure and would restrict the export of core technologies—such as model weights and source code—for models exceeding specific thresholds in training compute, parameter count, or global rankings.