The European Union (EU) has made a significant stride in the regulation of artificial intelligence (AI) with the passing of the EU AI Act. This landmark legislation is designed to manage the specific utilisation of AI systems and the associated risks, setting a global standard for AI laws.
The EU AI Act proposes a technology-neutral definition of AI systems, classifying them based on a ‘risk-based approach’. AI systems are categorised into four levels of risk: minimal, limited, high, and unacceptable. While AI systems presenting ‘unacceptable’ risks would be prohibited, a wide range of ‘high-risk’ AI systems would be authorised subject to a set of requirements and obligations. Limited and minimal risk AI systems have fewer requirements, with the main obligation being transparency.
The Act aims to foster innovation in AI while protecting the public. It focuses on data quality, transparency, human oversight, accountability, and addresses ethical questions and implementation challenges across various sectors. The cornerstone of the AI Act is a classification system that determines the level of risk an AI technology could pose to health, safety, or fundamental rights.
Companies that fail to comply with the regulations can face steep penalties, including fines up to €30 million or 6% of global income. The implementation of the regulation and ensuring uniform application across the EU will be overseen by a European Artificial Intelligence Board.
The Act has been under discussion since its proposal by the European Commission in April 2021. The final approval is expected by the end of this year, followed by a grace period for companies and organisations to adapt, often around two years.
Significance of the EU AI Act
The EU AI Act is a significant step towards ensuring the responsible use of AI, with the potential to set a precedent for AI regulation worldwide. It is a testament to the EU’s commitment to balancing the benefits of AI innovation with the need to safeguard public interests and fundamental rights.
The passing of the EU AI Act marks a new era in AI regulation. It not only sets a global standard but also sends a clear signal to the rest of the world about the importance of managing AI systems and their associated risks. As we move forward, the Act will undoubtedly serve as a reference point for other regions and countries looking to regulate AI.
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