The law is seen as a balance between protection and innovation, and it has been hailed as a model for regulators worldwide. However, it has also raised concerns about potentially slowing down technological innovation and giving further advantages to the US and UK, where AI research and development is more advanced. Once passed, the law will take two years to come fully into effect and will require EU countries to establish or formalize national bodies to regulate AI, as well as a pan-regional European regulator.
Key takeaways:
- European Union officials have reached a significant agreement on a law to regulate artificial intelligence (AI), which could set a global standard for risk classification, transparency enforcement, and financial penalties for noncompliance by tech companies.
- The law, known as the AI Act, will require tech companies to disclose data and conduct rigorous testing, particularly for high-risk applications. It also bans the highest-risk uses of AI and includes provisions for monitoring and oversight.
- Companies that violate the AI Act could face fines up to 7 percent of global revenue, depending on the violation and the size of the company breaking the rules. The law also includes restrictions for foundation models but gives broad exemptions to open-source models.
- Despite the new legislation, there are concerns that it could hinder technological innovation and disadvantage Europe in global competition, particularly against the United States and Britain, where AI research and development is more advanced.