The European Union has just reached a landmark agreement on a comprehensive AI law, poised to set a global precedent. This new regulation, known as the AI Act, is one of the first of its kind and aims to manage the rapidly evolving AI technology with a risk-based approach.

Key highlights of the AI Act include:

• Risk-Based Regulation: The AI Act will categorize AI systems based on their level of risk, with the most stringent regulations applied to high-risk models. This includes popular large AI models like ChatGPT.
• Enforcement Across EU: All 27 member states will be involved in enforcing the law, with certain aspects taking up to 24 months to become effective.
• Global Impact: The legislation is expected to influence AI development worldwide, serving as a model for other countries.
• Comprehensive Prohibitions: The AI Act will ban AI use for social scoring, manipulating human behavior, and exploiting vulnerable groups. Strict restrictions are also placed on facial recognition technology and AI systems in the workplace and educational institutions.
• Significant Fines for Non-Compliance: Companies that fail to comply with these new rules could face fines of up to €35 million or 7% of global revenue.
• Two-Tier Approach for AI Models: The Act establishes transparency requirements for general-purpose AI models and stronger requirements for those with systemic impacts.
• Encouragement for Innovation: Despite strict regulations, the Act aims to avoid excessive burdens on companies, promoting a balance between safeguarding AI technology use and encouraging innovation.
• Future Perspectives: Looking ahead, this legislation is a crucial step in shaping the global AI regulatory landscape, with implications for AI legislation and automated decision-making rules in other jurisdictions, including Canada, the United States, and beyond.

The EU AI Act is much more than just a set of rules; it’s a catalyst for EU startups and researchers to lead in the global AI race. With this act, the EU becomes the first continent to establish clear rules for AI use, potentially guiding future global standards in AI regulation.

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