EU Approves World's First AI Regulation Law... Up to 7% of Revenue Fine for Violations

Stricter Regulations on High-Risk AI
Global Spread Expected

The EU's 'AI Act,' the world's first artificial intelligence (AI) regulatory law, has been finally approved. It imposes strict regulations, including fines of up to 7% of global annual revenue.

The EU Council for Transport, Telecommunications and Energy made this decision at a meeting held in Brussels, Belgium, on the 21st (local time).

After publication in the official journal, it will take effect next month and be fully enforced starting next year.

The AI Act is characterized by its tiered regulation based on four levels of AI risk. AI technologies used in public services, elections, critical infrastructure, and autonomous driving are classified as high-risk due to the potential for serious harm if problems arise. Human oversight and risk management systems must be established for these uses.

Using AI to manipulate human behavior or to score individuals is prohibited within the EU. For example, using biometric data to classify people based on race, religion, sexual orientation, etc., or collecting facial information from the internet or closed-circuit television (CCTV) to build databases is banned. However, exceptions are allowed for preventing serious crimes such as terrorism or for suspect investigations.

Violations can result in fines of up to 7% of global annual revenue. To enforce this, an 'AI Office' will be established under the Directorate-General of the European Commission to oversee law enforcement.

With the recent emergence of generative AI such as ChatGPT, concerns about side effects like fake news and copyright infringement have increased. The comprehensive nature of the AI Act is the first of its kind globally and is expected to influence AI regulations in other countries.

Mathieu Michel, Belgium's Minister of Digital Affairs, stated, "Through the AI Act, Europe emphasizes trust, transparency, and accountability when handling new technologies, while ensuring that rapidly evolving technology can promote European innovation."

Patrick Van Eecke, partner at global law firm Couli, predicted that the EU's AI Act will spread worldwide. He said, "Companies outside the EU using EU customer data on AI platforms must comply with the law," adding, "Like the GDPR (General Data Protection Regulation), the AI Act is likely to serve as a blueprint."