European lawmakers have agreed on a political framework to regulate artificial intelligence in the region, including comprehensive AI law starting with the Artificial Intelligence Act, with penalties for breaching the rules potentially reaching 7% of a company’s global revenue.
The Act would be part of a series of EU regulations with global implications for the tech industry and its major players, such as Meta Platforms, Apple, and Google’s parent company Alphabet.
Recently, several big tech companies have come under fire for various concerns voiced by regulators, such as competition, which has been focused on Amazon, and now Microsoft’s ties to OpenAI, the leader in AI machine learning, being one of the latest.
But now the new AI regulations aim to set new competition and online content standards that will massively affect large AI tech companies.
“The EU is the first in the world to set in place robust regulation on AI,” said Dragos Tudorache, a Romanian member of the European Parliament and lead delegates of the AI Act.
According to a statement from the European Parliament, lawmakers have agreed on a deal that prohibits several AI applications, such as creating facial-recognition databases by indiscriminately scraping images, and establishes rules for systems that are considered to be high-risk by lawmakers. The deal also requires general-purpose AI systems and the models that power them to be transparent.
AI regulation continues to be a global challenge, but countries like the U.S. have drafted an executive order said to be one of the toughest set of actions to ensure the safety of AI systems while China dispensed rules dealing with generative AI.
The EU Act intends to set clear rules for numerous types of AI, especially those that use large data sets and have a high potential for harm. The Act also demands transparency and accountability from AI developers and users.
According to a separate announcement from the Council of the EU, the Act does not concern AI systems that are operated only for military or defence purposes and will still require final endorsement from parliamentarians and representatives from the EU’s 27 countries. Because of this, the Act will not likely take full effect before 2026.
Industry and consumer groups have raised the alarm that regulations like the Act could leave Europe behind and DigitalEurope, a tech lobby group, said the Act would be costly for AI companies to conform to.
“The AI race is not one Europe can miss out on,” said Cecilia Bonefeld-Dahl, the group’s director-general.
The European Consumer Organization asserted that the new regulations need to be more robust to be effective in protecting consumers.
“Too many issues have been left underregulated, with an overreliance on companies’ goodwill to self-regulate,” the group’s deputy director-general, Ursula Pachl, said.
