It's unlikely to be able privacy laws, but rather DMA / competition laws.

Apple Intelligence requires deep access to user data, systems apps, etc to make it useful.

Under the DMA, Apple would be required to also offer similar functionality to competitors (e.g. Google).

Ironically the DMA is telling Apple to reduce privacy to make Apple Intelligence work in the EU, it’s just a populist political attempt at regulating a market.

No sane person actually thinks Apple isn’t private enough for EU standards, they’re just not being allowed to compete because they aren’t allowing anyone else access to local user context, which would be a privacy nightmare if done incorrectly.

I agree that Apple being stubborn is part of this, but also the point of the DMA / antitrust in general is that large companies that control their own markets can't do some of the same things that less influential companies in the same space can do.

Apple Intelligence is a set of features for a platform (iOS) which the EU has determined to be a Gatekeeper platform which comes with special restrictions and oversight.

There's a regulatory difference between that and just releasing an LLM accessible via the web or an app download.