And the legality of this may vary by jurisdiction. There’s a nonzero chance that they pay a few million in the US for stealing books but the EU or Canada decide the training itself was illegal.

Then the EU and canada just won't have any sovereign LLMs. They'll have to decide if they'd rather prop up some artificial monopoly or support (by not actively undermining) innovation.

It’s not going to happen. The EU is desperate to stop being in fourth place in technology and will do absolutely nothing to put a damper on this. It’s their only hope to get out of the rut.