Your looking at this from a legal perspective. Consider a diplomatic one instead.

Model training is expensive. Model distillation is cheaper. If you train models, and that lets your adversary distill them for much cheaper, that gives your adversary an advantage. Giving your adversary an advantage is bad, so you address it.

It doesn’t matter whether the advantage was gained legally, not even if it was fair. The advantage in and of itself is bad, and sufficient reason to act. You couch it in less nakedly power hungry terms, but this is the reasoning.