EU's AI Act: Key Highlights and Projections
What changed?
Hello everyone,
We are going a bit serious in this edition, you will see the “lawyer” side of me. We ll cover the pivotal developments surrounding the EU Artificial Intelligence Act, a cornerstone in shaping the future of AI governance.
Executive Summary
European Parliament approved the draft of the EU Artificial Intelligence Act (EU AI Act) on June 14, 2023.
Negotiations to commence among European institutions to finalize the act's text.
The earliest possible application of the EU AI Act is anticipated to be in 2025.
The act will apply to providers and deployers of AI systems affecting the EU, regardless of their location of establishment.
The Parliament's version emphasizes fostering trustworthy AI through:
Broadening the ban on certain AI system applications, including:
Remote biometric identification in public spaces.
Emotion recognition systems.
Predictive policing systems.
Including in the high-risk category:
AI systems used to sway voters.
AI systems used in recommender systems of very large online platforms (VLOPs).
Setting forth stringent requirements for providers of foundation models, which are:
Trained on extensive data at scale.
Designed for a wide variety of outputs.
Adaptable to numerous distinctive tasks.
Including those that fuel generative AI systems.
Introduction to the EU's Forthcoming AI Regulations
On June 14, 2023, a pivotal milestone was reached when the European Parliament approved its draft of the EU Artificial Intelligence Act (the "EU AI Act"). This marks the onset of discussions among European institutions to finalize the act's text. If swiftly adopted, we can anticipate its earliest application in 2025, introducing a series of responsibilities for both creators and users of AI systems operating or affecting the EU, irrespective of their establishment location.
The Core Aims of the EU AI Act
The EU AI Act, initially proposed in 2021, is designed to govern the market introduction and usage of AI systems. It proposes a risk-based categorization of AI systems into three primary groups: unacceptable risk, high risk, and limited risk, each having distinct compliance and governance prerequisites. This act is poised to influence not only providers and users within the EU but also those outside its boundaries, especially if the AI system's output is intended for use within the EU.
Primary Objectives of the EU AI Act
The EU AI Act is centered around several key objectives, aiming to:
Ensuring Safety and Legal Compliance: Develop clear guidelines to prevent potential harm to individuals and society, and ensure the legality of AI systems in the EU market.
Providing Legal Certainty: Offer a transparent regulatory framework to foster investment in AI within the EU.
Establishing Governance and Enforcement Mechanisms: Develop systems at both the EU and national levels to effectively enforce the rules and protect fundamental rights and safety standards.
Facilitating a Unified Market: Create a single market for trustworthy AI applications, allowing free trade and usage of AI products compliant with EU regulations across member nations.
Adopting a Balanced Approach: Navigate the risks associated with AI without hindering technological advancement, leveraging the advantages of AI while addressing potential ethical dilemmas.
Significant Proposals in the Parliament's Draft
The Parliament's draft of the Act has introduced several noteworthy amendments to the Commission's initial proposal, focusing on promoting trustworthy AI. Some of the key proposals include:
Broadening the Prohibition on Certain AI Uses: Including those involving remote biometric identification in publicly accessible spaces, emotion recognition, and predictive policing systems.
Expansion of High-Risk AI Systems: Including systems used to influence voters or used in recommender systems of very large online platforms (VLOPs).
Setting Requirements for Foundation Model Providers: Including those powering generative AI systems, with obligations encompassing risk mitigation, data governance, performance standards, and registration in an EU database maintained by the Commission.
Background and Evolution of the EU AI Act
Initially proposed in 2021, the EU AI Act sought to regulate the market placement and usage of AI systems, categorizing them based on the level of risk they pose. The Act outlined specific obligations and prohibitions for different risk categories, aiming to protect individuals and groups from potential vulnerabilities exploited by AI systems.
New Developments in the Parliament's Draft
The Parliament has proposed several critical amendments, including:
Obligations for Foundation Model Providers: Requiring them to demonstrate risk mitigation, adhere to data governance measures, and register in an EU database.
Additional Responsibilities for High-Risk AI System Deployers: Including implementing human oversight, monitoring robustness, and conducting a fundamental rights impact assessment before deploying a high-risk AI system.
Prohibited AI Practices and High-Risk AI Systems: Expanding the list of prohibited AI practices and high-risk AI systems, including restrictions on facial recognition and biometric categorization systems.
Shortened Timeframe for Incident Reporting: Reducing the reporting timeframe for serious incidents from 15 days to 72 hours.
Heightened Penalties: Raising the penalties for non-compliance to EUR 40 million or 7% of the total worldwide annual turnover, whichever is higher.
What Lies Ahead
The Commission, the Council of the EU, and the Parliament are now gearing up to commence negotiations to agree on the final text of the EU AI Act. If adopted, the Act will be directly applicable across the Union, imposing obligations on AI system providers, importers, distributors, and deployers from 24 months following its enforcement, potentially starting in 2025.
Guidance for Businesses in the Current Scenario
Businesses heavily reliant on AI systems, particularly those considered high-risk, should initiate conformity efforts at early development stages. Critical steps include assessing data governance practices, preparing support documentation in line with potential obligations, and establishing processes for reporting AI-related incidents. Compliance with the proposed EU AI Act will likely build upon established GDPR practices and existing cybersecurity rules.
Conclusion
In conclusion, the EU AI Act represents a significant stride towards fostering a secure and transparent AI landscape within the European Union, balancing the potential benefits of AI with ethical considerations.
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