European Union Begin Landmark AI Law Enforcement With Restrictions
The European Union has officially begun enforcing a landmark artificial intelligence law this week, setting a new standard for AI restrictions and large fines for violations.
The EU AI Act is the first-of-its-kind regulatory outline for this growing technology, according to reports. This past Sunday was the deadline for prohibitions on certain AI systems and requirements to guarantee technology literacy among staff members.
Companies now need to comply with these restrictions and will face penalties if they don’t. The AI Act bans certain applications of AI that are considered to pose an “unacceptable risk to citizens,” CNBC reported.
Specifically, social scoring systems, real-time facial recognition, and other types of biometric identifications that categorize people by their race, sex life, sexual orientation, and more. The Act also bans what they consider manipulative AI tools.
If companies are to breach the act they can face fines up to 35 million euros ($35.8 million) or 7% of their global annual revenues, depending on which of the amounts is larger. The size of the penalty will also depend on the size of the company and the specific infringement.
The Act itself isn’t fully implemented yet, but it’s in its initial stages of developments that are upcoming.
“It’s quite important to recognize that the AI Act is predominantly a product safety legislation,” said Tasos Stampelos, the head of EU public policy and government relations at Mozilla, to CNBC during a panel in November.
“With product safety rules, the moment you have it in place, it’s not a done deal. There are a lot of things coming and following after the adoption of an act,” he said.
“Right now, compliance will depend on how standards, guidelines, secondary legislation or derivative instruments that follow the AI Act, that will actually stipulate what compliance looks like.”
Some technology executives and investors are not happy with the AI Act considering this technology is so new. They fear the Act will deter the development of AI.
For example, Prince Constantijn of the Netherlands told CNBC last summer that he’s “concerned” over the EU’s focus on regulating AI.
“Our ambition seems to be limited to being good regulators,” Constantijn said. “It’s good to have guardrails. We want to bring clarity to the market, predictability and all that. But it’s very hard to do that in such a fast-moving space.”
Other leaders, however, believe that these regulations will give Europe a global advantage over the development of AI thanks to the regulations they’re implementing.
“While the U.S. and China compete to build the biggest AI models, Europe is showing leadership in building the most trustworthy ones,” Diyan Bogdanov, director of engineering intelligence and growth at Bulgarian fintech firm Payhawk, said.
“The EU AI Act’s requirements around bias detection, regular risk assessments, and human oversight aren’t limiting innovation — they’re defining what good looks like,” he stated.
Eric Mastrota is a Contributing Editor at The National Digest based in New York. A graduate of SUNY New Paltz, he reports on world news, culture, and lifestyle. You can reach him at eric.mastrota@thenationaldigest.com.