Revolutionary Regulation from EU: AI Act is Approved

The European Union (EU) aimed to regulate revolutionary technology in a regulatory manner with the Artificial Intelligence Act (AI Act). As a matter of fact, on 14 June 2023, European Parliament initiated inter-institutional negotiations on artificial intelligence regulation. You can access our TFP June 2023 issue, which includes our article on the subject, here.

Now, on 13 March 2024, the European Parliament approved the AI Act, taking one of the significant steps that will determine the future of artificial intelligence. In addition to regulating the use of artificial intelligence technologies, AI Act is also critical in terms of security and innovation.

The scope of the AI Act is; (i) providers of artificial intelligence systems to be offered on the EU market, regardless of whether they are based in the EU, (ii) users of artificial intelligence systems located in the EU, and (iii) providers and users of non-EU artificial intelligence systems in case they are used in the EU. One of the objectives in keeping the scope so broad is to ensure that artificial intelligence systems to be used in EU countries are safe and fundamental rights are respected. In this regard, AI Act is envisaged to be a significant regulation that will ensure the protection of people's privacy and personal rights.

In case of non-compliance with the rules introduced by the AI Act, the fines to be paid by companies will vary between 35 million Euros or 7% of global turnover and 7.5 million Euros or 1.5% of turnover, depending on the violation and the size of the company.

AI Act will enter into force twenty days after its publication in the Official Journal of the EU. However, AI Act will become fully applicable gradually within twenty-four months from the date of entry into force as follows:

- 6 months after entry into force; EU member states will phase out prohibited systems;

- 12 months after entry into force; obligations on general-purpose AI systems will enter into force;

- 24 months after entry into force; high-risk system obligations defined in the list of high-risk use cases will enter into force; and

- 36 months after entry into force; high-risk system obligations that are already subject to other EU legislation will come into force.

In brief, the European Parliament's approval of the AI Act is one of the biggest steps towards AI-based technologies. In addition to being a step towards ensuring that AI technologies are developed and used in a safe and ethical manner, the AI Act also sets out a comprehensive roadmap. For this reason, it is critical for companies operating in the field of artificial intelligence to initiate compliance processes with the systematics envisaged by the AI Act.

You can access the European Parliament's announcement of the approval of the AI Act of 13 March 2024 here.