What You Need to Know About DeepSeek AI’s License and Its Restrictions
Image Credit: Markus Winkler | Splash
As artificial intelligence continues to shape the technological landscape, companies developing AI models must navigate the complex balance between openness and responsible use. DeepSeek, a Chinese AI company, has introduced a comprehensive license agreement for its generative AI models under the V3 version. Titled DeepSeek License Agreement Version 1.0, the document aims to reconcile permissive open-source principles with ethical and legal constraints on AI deployment. However, it also raises questions about the trade-offs between innovation and control.
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The Promise of Openness: Key Advantages
One of the primary appeals of DeepSeek’s license is its open-access approach, which aligns with the philosophy of fostering AI research and development. Here are some of the notable benefits:
1. Broad Copyright and Patent Grants
DeepSeek grants users a worldwide, perpetual, royalty-free, and irrevocable license to use, modify, and distribute its AI models and accompanying software. According to Section II, Clause 2 of the agreement:
“DeepSeek hereby grants to You a perpetual, worldwide, non-exclusive, no-charge, royalty-free, irrevocable copyright license to reproduce, prepare, publicly display, publicly perform, sublicense, and distribute the Complementary Material, the Model, and Derivatives of the Model.”
This approach follows the structure of widely recognized open-source licenses, making AI development more accessible to individuals and organizations. For example, a startup building an AI-powered customer service chatbot can customize and fine-tune DeepSeek’s model to suit industry-specific needs, integrate it into their product, and sell it commercially without worrying about royalties or patent risks. This open licensing lowers entry barriers, fosters scalability, and ensures long-term stability, making AI development more accessible to individuals and businesses alike.
2. Encouragement of AI Research and Development
By allowing derivative models to be created, DeepSeek’s license fosters innovation. Researchers and developers can fine-tune, update, and re-train models based on DeepSeek’s foundational work, provided they adhere to specific ethical constraints in Clause 2.
For example, an academic research team studying AI-generated medical diagnostics can modify DeepSeek’s model to analyze radiology scans with greater accuracy. By retraining the model on medical datasets, they can improve early disease detection while avoiding high development costs. Since DeepSeek’s license supports modifications, the researchers can publish their advancements, share findings with the medical community, and even collaborate with hospitals to deploy AI-driven diagnostic tools—accelerating progress in healthcare AI.
3. Commercial Flexibility
The license permits commercial usage, including Software-as-a-Service (SaaS) applications, API-based services, and enterprise AI solutions.
“You may host for Third Party remote access purposes (e.g. software-as-a-service), reproduce and distribute copies of the Model or Derivatives of the Model thereof in any medium, with or without modifications …” (Clause 4)
For example, a tech startup developing an AI-powered legal assistant can deploy DeepSeek’s model to analyze legal documents, generate contract summaries, and provide case law insights through a subscription-based SaaS platform. Since the license permits remote access and distribution, the startup can offer API integrations for law firms, scale its service globally, and monetize AI-driven legal assistance without paying licensing fees—lowering costs while maximizing business opportunities.
[Read More: DeepSeek AI Faces Security and Privacy Backlash Amid OpenAI Data Theft Allegations]
Ethical and Legal Restrictions: Areas of Concern
Despite the benefits of DeepSeek’s license, several clauses introduce concerns regarding enforceability, user freedom, and broader implications for AI governance.
1. Strict Use-Based Restrictions
DeepSeek enforces specific prohibitions on AI applications. While some restrictions align with ethical AI principles—such as bans on child exploitation, discrimination, and unauthorized collection of personal data—others raise questions about limitations on free expression and decision-making autonomy.
According to Attachment A of the license:
"You agree not to use the Model or Derivatives of the Model:
To generate or disseminate verifiably false information and/or content with the purpose of harming others;
To generate or disseminate inappropriate content subject to applicable regulatory requirements;
For fully automated decision making that adversely impacts an individual’s legal rights or otherwise creates or modifies a binding, enforceable obligation”
These restrictions introduce ambiguity in enforcement, as terms like "harm," "inappropriate content," and "adversely impact" can be subjectively interpreted. This raises concerns over how such provisions might be applied across different jurisdictions and use cases, potentially limiting AI-driven expression and decision-making autonomy. For example, a journalism startup using AI to fact-check political claims may face restrictions if the AI-generated analysis is deemed "verifiably false" or "harmful" in politically sensitive contexts. Similarly, a financial advisory firm using AI to assess creditworthiness might be blocked from deploying DeepSeek’s model, as automated decisions that affect legal rights (e.g., loan approvals) could be restricted. These vague definitions create uncertainty, potentially discouraging businesses from adopting DeepSeek’s AI for critical decision-making tasks due to compliance risks.
[Read More: EU Blocks Chinese AI App DeepSeek Over GDPR Compliance Concerns]
2. Risk of Remote Enforcement
A particularly controversial clause allows DeepSeek to impose remote restrictions on AI usage:
“To the maximum extent permitted by law, DeepSeek reserves the right to restrict (remotely or otherwise) usage of the Model in violation of this License.” (Clause 7)
This means DeepSeek can monitor and control the use of its AI models to enforce compliance with licensing terms. However, the feasibility of such enforcement depends on several factors:
Deployment Environment: If the model is hosted on DeepSeek’s servers or relies on their infrastructure (e.g., API services), enforcement is straightforward since DeepSeek controls access.
User-Controlled Environments: If users deploy the model on their own infrastructure without ongoing communication with DeepSeek, remote enforcement becomes significantly harder.
For instance, consider a healthtech startup using DeepSeek’s model to power an AI-driven mental health chatbot. If DeepSeek determines that the chatbot’s responses violate ethical guidelines—such as unintentionally providing medical advice—it could remotely disable the model without prior warning. This could disrupt patient support, impact business operations, and create legal and financial risks for the startup.
A key concern is the lack of transparency in how DeepSeek defines and enforces violations. Businesses integrating the model into critical applications must carefully review the licensing terms and assess the potential risks of remote enforcement. While DeepSeek asserts this right, the effectiveness and legality of such actions may vary depending on jurisdiction and specific use cases.
[Read More: Exploring Methods to Bypass DeepSeek's Censorship: An AI Perspective]
3. Legal Jurisdiction in China
DeepSeek’s license is governed by the laws of the People’s Republic of China (PRC) and grants exclusive jurisdiction to courts in Hangzhou:
“This agreement will be governed and construed under PRC laws without regard to choice of law principles … The courts located in the domicile of Hangzhou DeepSeek Artificial Intelligence Fundamental Technology Research Co., Ltd. shall have exclusive jurisdiction.” (Clause 14)
This jurisdictional clause may lead international businesses and researchers to carefully consider regulatory factors and legal frameworks when adopting DeepSeek’s models. For example, a U.S.-based AI startup integrating DeepSeek’s model into a commercial chatbot service might face a contractual dispute over model modifications. If DeepSeek claims the startup violated the license, the case would fall under the jurisdiction of Chinese courts, which may interpret contract law differently from Western legal systems. This could result in legal uncertainties, increased costs, and complex enforcement issues, making it a critical consideration for companies relying on DeepSeek’s AI models.
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4. Unclear Stance on User Data Privacy
The license acknowledges that the AI models may contain personal data and intellectual property from third parties, yet it places the burden of compliance entirely on users:
“This Model may contain personal information and works with IP rights.” (Clause 9)
This ambiguity could expose users to potential legal liabilities if AI-generated outputs inadvertently process sensitive data. For example, a marketing agency using DeepSeek’s model to generate automated blog content might unknowingly produce text containing personal information or copyrighted material from third-party sources embedded in the training data. Since DeepSeek places the entire burden of compliance on users, the agency could face legal action for data protection violations (e.g., under GDPR in Europe or CCPA in California) or copyright infringement claims, even if they had no direct control over the model’s training data. This lack of clarity forces businesses to take on additional legal vetting and compliance efforts, making DeepSeek’s AI models a potential liability risk in regulated industries.
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Source: DeepSeek V3 Technical Paper, DeepSeek V3 Model License
