EU passes AI legislation: What it means for Consumers?

AI Watch is a document published by the European Commission outlining the EU's Artificial Intelligence strategy. It provides an in-depth overview of the current landscape of AI in Europe and the Commission's goals and objectives for the future of AI in Europe. This document outlines the significant benefits AI can bring to Europe and how governments can ensure that these benefits are shared by all citizens while safeguarding against potential risks.[1][2] AI Watch carefully examines the potential impact of AI on the economy, society, and environment and outlines policy recommendations for governments to ensure that AI advances responsibly and sustainably.[3][4] Furthermore, it explores the need for a comprehensive European approach to AI to ensure that the European Union remains at the forefront of AI development.

The five pillars of the EU's strategy

The strategy is built upon five key components: Research and Innovation, Funding, Policy, Ethics and Governance, and International Coordination. The first component aims to foster an AI ecosystem that promotes innovation within the EU by implementing funding initiatives such as the Horizon 2020 Framework Program. The second component focuses on establishing a suitable fiscal policy to support research endeavors and develop necessary infrastructure. The third component encompasses measures to enhance public awareness and understanding of the functioning and implications of AI. The fourth aspect focuses on formulating ethical principles for the design, implementation, and testing of AI systems. This includes establishing a code of conduct for researchers involved in AI technology. Lastly, the fifth element involves collaboration with international organizations to ensure equal access to global developments in artificial intelligence research and future technological advancements across generations.[5]

The European Union has released a strategic report on Artificial Intelligence, AI Watch. The report outlines the EU's current strategy for regulating AI and its potential implications for Europe's role in global AI development.[6]

The document is organized into four main sections: "Current Status," "Implemented Measures," "Immediate Challenges," and "Long-Term Challenges." The initial section of the report provides an overview of the impact that AI has had on everyday life, such as advancements in self-driving vehicles, natural language processing technologies, and predictive analytics. It also emphasizes how these developments influence our economy and society as a whole, raising concerns about potential inequalities or discriminatory practices that may arise from their implementation.

The second section focuses on specific actions that various institutions have taken within the European Union (EU) to address these issues, such as investing in research programs that promote diversity in AI development or creating new regulations around data privacy laws.[7][8]

The third section discusses both short-term challenges—such as ensuring that there are enough skilled workers available to meet the growing demand for AI services—and longer-term challenges—such as making sure that our data privacy laws are keeping up with technological advancements (i.e., using artificial intelligence)[9]

The European Union is currently engaged in discussions on how to establish itself as a global leader in AI development. To this end, the EU has initiated an AI Watch program that aims to keep pace with other influential players such as China and the United States. This article will provide insights into why the EU deems it crucial to invest in AI, outline their current efforts, as well as their future plans for this field of technology.

A Closer Look at Consumer Implications

The recent AI legislation passed by the EU has a range of implications for consumers, focusing on ensuring the safe and responsible use of AI technologies across various sectors. Here's a breakdown of what the EU's AI legislation entails for consumers:

Regulation of High-risk AI Applications

The legislation aims to regulate high-risk AI applications more stringently, ensuring that they adhere to the EU's standards for safety, transparency, and fundamental rights.[10]

High-risk AI systems will be subjected to assessment before being put on the market and also throughout their lifecycle.[11]

Specific areas identified for high-risk AI include biometric identification, critical infrastructure management, education, employment, essential private and public services, law enforcement, legal assistance, and migration management.[11]

Banning Unacceptable Risks

Certain AI systems deemed as unacceptable risks will be banned, such as those involving cognitive behavioral manipulation of individuals or groups, social scoring based on personal characteristics, and real-time biometric identification systems like facial recognition.[12]

Transparency Requirements

For generative AI like ChatGPT, transparency requirements include disclosing that content was generated by AI, designing models to prevent the generation of illegal content, and publishing summaries of copyrighted data used for training.[13]

Limited-risk AI systems should comply with minimal transparency requirements allowing users to make informed decisions, especially when interacting with AI systems that generate or manipulate image, audio, or video content like deepfakes.[2]

Updated Liability Legislation

The legislation may make it easier for individuals in the EU who are harmed by AI systems to seek compensation, thanks to two new Directives proposed by the European Commission.[14]

Consumer Protection Concerns

Despite these regulations, some consumer groups feel the proposal falls short of the EU’s own objective of enabling trustworthy AI, expressing concerns that the proposed rules do not adequately protect consumers from possible economic harm.[15]

Data Quality and Human Oversight

There's an emphasis on data quality, openness, human oversight, and accountability to ensure that AI systems are developed and used responsibly across socioeconomic processes, government use of AI, and regulated consumer products.[16]

Public Influence on AI Design

Other EU legislation aims to enable more public transparency and influence over the design of AI systems in social media and e-commerce, giving consumers a say in how these technologies are developed and deployed.[17]

This legislation represents a comprehensive effort by the EU to regulate the burgeoning field of AI, with a particular focus on ensuring that the technology is used in a manner that is safe, ethical, and beneficial for consumers and the broader public.

So Why Invest in AI?

The EU faces many challenges as a result of Brexit. While some positives are associated with this situation—such as focusing more on domestic issues—it also means that Europe must find ways to collaborate better and compete against other regions where countries have stronger relationships than they do with each other.

This is where artificial intelligence comes into play. For Europe to remain competitive globally and ensure its long-term economic prosperity, it needs to develop its own AI strategies that are responsive enough to meet consumer demand today and ensure that future generations are not left behind by their competitors regarding technology development capabilities.

Read more about the publication at:

https://publications.jrc.ec.europa.eu/repository/handle/JRC129123

References

1. AI watch, national strategies on artificial intelligence. https://op.europa.eu/en/publication-detail/-/publication/619fd0b5-d3ca-11eb-895a-01aa75ed71a1.

2. EU AI Act: first regulation on artificial intelligence. https://www.europarl.europa.eu/news/en/headlines/society/20230601STO93804/eu-ai-act-first-regulation-on-artificial-intelligence.

3. The impact of AI on business and society | Financial Times. https://www.ft.com/content/e082b01d-fbd6-4ea5-a0d2-05bc5ad7176c.

4. Modeling the global economic impact of AI | McKinsey. https://www.mckinsey.com/featured-insights/artificial-intelligence/notes-from-the-AI-frontier-modeling-the-impact-of-ai-on-the-world-economy.

5. The New European Innovation Agenda - Research and innovation. https://research-and-innovation.ec.europa.eu/strategy/support-policy-making/shaping-eu-research-and-innovation-policy/new-european-innovation-agenda_en.

6. AI Watch - Publications Office of the EU. https://op.europa.eu/en/publication-detail/-/publication/3bddb039-909e-11ed-b508-01aa75ed71a1/language-en.

7. Types of institutions, bodies and agencies | European Union. https://european-union.europa.eu/institutions-law-budget/institutions-and-bodies/types-institutions-and-bodies_en.

8. Types of EU law - European Commission. https://commission.europa.eu/law/law-making-process/types-eu-law_en.

9. Risks and challenges of data access and sharing | Enhancing Access to .... https://www.oecd-ilibrary.org/sites/15c62f9c-en/index.html?itemId=/content/component/15c62f9c-en.

10. The European Commission’s Artificial Intelligence Act. https://hai.stanford.edu/sites/default/files/2021-06/HAI_Issue-Brief_The-European-Commissions-Artificial-Intelligence-Act.pdf.

11. Guidance on Classification and Conformity Assessments for High-Risk AI .... https://ai-regulation.com/guidance-on-high-risk-ai-systems-under-eu-ai-act/.

12. UN urges moratorium on use of AI that imperils human rights. https://apnews.com/article/technology-business-laws-united-nations-artificial-intelligence-efafd7b1a5bf47afb1376e198842e69d.

13. How to create, release, and share generative AI responsibly. https://www.technologyreview.com/2023/02/27/1069166/how-to-create-release-and-share-generative-ai-responsibly/.

14. Artificial intelligence liability directive | Think Tank | European .... https://www.europarl.europa.eu/thinktank/en/document/EPRS_BRI(2023)739342.

15. Consumer protection law - European Commission. https://commission.europa.eu/law/law-topic/consumer-protection-law_en.

16. Beyond Accuracy: What Data Quality Means to Data Consumers. https://www.jstor.org/stable/40398176.

17. Artificial Intelligence Act: Council calls for promoting safe AI that .... https://www.consilium.europa.eu/en/press/press-releases/2022/12/06/artificial-intelligence-act-council-calls-for-promoting-safe-ai-that-respects-fundamental-rights/.