Over the shoulder view of young businesswoman using AI assistant on smartphone

Understanding the AI Act: What it Means for You

3 minutes

The European Council has set the stage for a game-changing shift in the landscape of artificial intelligence with the proposal of a new regulation which will harmonize rules on AI (AI Act). This landmark legislation has far-reaching implications for both providers and users of AI systems, and it is crucial for businesses to understand how it may impact their operations.

The AI Act introduces a tiered approach to classifying AI systems based on their potential risks ranging from unacceptable risk to minimal risk. This categorization sets the stage for a nuanced regulatory framework, where obligations are tailored to the level of risk posed by the AI system in question. Providers of high-risk AI systems, in particular, will find themselves under the spotlight, as they bear the brunt of compliance obligations.

It is expected that the AI Act will be approved in April 2024. Upon approval, the AI Act will be phased in gradually. For businesses, this means now is the time to take stock and prepare for the changes ahead.

Our Perspective on the Amending Law 

For businesses operating within the EU or dealing with EU data, compliance with the AI Act is paramount. Whether you're a deployer, provider, or a user of AI systems, understanding your obligations and ensuring compliance is essential to avoid penalties and maintain trust with your stakeholders.

It's imperative to conduct a thorough assessment to determine where your AI systems fall within the risk spectrum. From there, make any necessary adjustments to ensure compliance. Keep all technical documentation and compliance materials up-to-date and easily accessible for regulatory scrutiny. Additionally, invest in educating your team members on the intricacies of the AI Act to foster a culture of compliance and accountability.

In the evolving landscape of AI regulation, proactive engagement and meticulous preparation will be the keys to success. Embrace the changes, adapt swiftly, and position your business for a future where innovation and compliance go hand in hand.

How we can Help

At Royal Pine, our team of legal and regulatory experts stand ready to support you during your AI journey. We can offer guidance on how to navigate the AI Act and fulfill your obligations thereunder. Royal Pine can assist you with a variety of services, including but not limited to, conducting a comprehensive evaluation of your existing AI policies and practices, identifying any areas that may need enhancement or amendments to comply with the AI Act and/or drafting the relevant policies and procedures, as may be applicable. 


* This publication has been prepared as a general guide and for information purposes only. It does not purport to be comprehensive or to render professional advice. Before making any decision or taking any action that may affect you and/or your business, bespoke advice should be obtained.

Zoe is a Legal Consultant at Royal Pine. She is a qualified lawyer with experience in the financial industry and holds the Advanced Certificate of CySEC.