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The EU’s New AI Act: A Global Digital Rule-Maker

On March 13, 2024, the European Parliament took a decisive step by voting in favour of the EU AI Act. This comprehensive legislation aims to lay down harmonized rules for artificial intelligence (AI) within the European Union.

The journey toward the AI Act began back in April 2021. After extensive deliberations and revisions, the European Parliament endorsed the regulation with 523 votes in favour, while 46 MEPs voted against it, and 49 abstained. This momentous decision marks a critical milestone in shaping the future of AI governance.

The legislation targets the risks posed by fast-moving technology and aims to safeguard the safety, livelihoods, and rights of EU citizens.


Key Provisions of the AI Act

1.            Risk Mitigation: The AI Act threatens an outright ban on AI applications that carry unacceptable risks. These risks include cognitive behavioural manipulation, social scoring, and biometric identification. It also places significant obligations on the use of AI in “high-risk” applications, such as health, critical infrastructure, border control, education, justice, and everyday services.

2.            Applicability: The law applies not only to businesses operating within the EU but also to tech giants behind AI products used by European citizens. This broad scope ensures that major players in the AI industry are held accountable.

3.            Human Oversight: The AI Act emphasizes the need for human oversight in critical contexts. While AI can enhance efficiency, human judgment remains crucial to prevent unintended consequences.

4.            EU’s New AI Office: The establishment of the EU’s new AI Office will play a crucial role in shaping global norms. While enforcement powers matter, the mere existence of this office will signal the EU’s commitment to responsible AI development.


While the AI Act aims to protect citizens, it also raises questions about innovation. Striking the right balance between regulation and fostering AI development is essential. Small businesses, startups, and tech giants alike must adapt to these new rules.


The Brussels Effect and Global Norms

The Brussels effect refers to the EU’s ability to set global standards through its regulations. The GDPR, despite its critics, prompted global changes as platforms adapted to comply. Privacy standards and awareness became commonplace worldwide.

The AI Act could similarly raise the profile of AI risks and lead to changes beyond EU borders.

Challenges and Competition

The AI Act is not just about compliance; it’s about shaping the future of AI. As the EU takes this bold step, other nations will observe closely.

Will they follow suit? Only time will reveal the full impact of this landmark legislation, but one thing is certain: the EU has positioned itself as a global digital rule-maker in the AI domain

The AI Act’s impact is not guaranteed. China, too, has made significant efforts to regulate AI and set standards. As the EU moves forward, it must contend with other players vying for influence in the AI landscape. First-mover advantage matters, but the EU is not alone in shaping AI rules.

The EU’s AI Act represents an immense step toward responsible AI governance.

Its provisions and the establishment of the AI Office signal the EU’s commitment to digital safety. Whether it becomes a global norm remains to be seen, but its impact on raising awareness and scrutiny of AI risks is undeniable. As AI becomes more integrated into our lives, the EU’s decision to address these risks head-on will resonate far beyond its borders.

Dr Dorel Iosif

CEO, LAVAUX Advisory


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