The European Union’s Artificial Intelligence (AI) Act is a groundbreaking piece of legislation designed to regulate the use of AI technology within the EU. Adopted in 2023, it stands as the world’s first comprehensive AI law. The key aspects of the AI Act include:

  1. Risk-Based Classification: The Act classifies AI systems based on the risk they pose to users. This classification determines the level of regulation each system will be subject to. AI systems are divided into categories such as unacceptable risk, high risk, limited risk, and minimal risk.
  2. Bans and Restrictions: Certain AI applications deemed to pose unacceptable risks are banned. These include:
    • Cognitive behavioral manipulation, particularly targeting vulnerable groups like children.
    • Social scoring systems, which classify individuals based on behavior, socio-economic status, or personal characteristics.
    • Real-time and remote biometric identification systems in public spaces, with certain narrow exceptions for law enforcement.
  3. Transparency Requirements for Generative AI: AI systems like ChatGPT must disclose that content is AI-generated, prevent generation of illegal content, and publish summaries of copyrighted data used in training.
  4. High-Risk AI Systems: This category includes AI systems in areas like biometric identification, critical infrastructure management, law enforcement, and employment. These systems must undergo rigorous assessment before and during their lifecycle.
  5. Consumer Rights and Obligations: The Act gives consumers the right to file complaints and receive explanations about AI decisions that impact them. It also imposes obligations on AI providers and users based on the level of risk associated with their systems.
  6. Fines for Non-Compliance: Companies that fail to comply with the AI Act’s provisions can face substantial fines, ranging up to €35 million or 7% of global turnover.
  7. Support for Innovation and Small Businesses: The Act promotes regulatory sandboxes and real-world testing to help businesses, especially SMEs, to develop AI innovations.
  8. Focus on Fundamental Rights and Democracy: A key goal of the AI Act is to ensure that AI technologies used in the EU are safe, transparent, traceable, non-discriminatory, and environmentally friendly. It emphasizes human oversight over AI systems to prevent harmful outcomes.