Regulating artificial intelligence (AI) has become the battleground of industrial lobbyists, consumer groups, ethicists and policy makers, resulting in a proliferation of standards, guidelines and regulatory initiatives. A key contradiction for policy makers arises from the quest for national competitiveness in technological development as opposed to the legitimate needs of privacy for consumers and workers. Depending on their respective political economy, countries so far have opted for a mix of technological leniency, hard ex-ante regulation and soft-law approaches. However, given the growing share of digital services that are traded internationally, national regulatory bodies are subject not only to their own domestic pressure groups but also need to integrate the regulatory realities of their main trading partners. As a consequence, regulatory complexity has increased significantly, creating significant barriers to entry for newcomers, changing global AI value chains and adding regulatory opacity for consumers and workers, thereby undermining regulatory protection.