The EU’s Al Act (Regulation 2024/1689) enters into force today, August 1, 2024. The groundbreaking Act is designed to ensure that AI systems are safe, transparent, and governed by rules that protect fundamental rights. The Act categorizes AI applications into risk-based tiers, with each tier subject to different levels of regulatory scrutiny and compliance requirements.

The Act will become fully applicable in two years. However, some requirements of the Act, mainly related to prohibited Al practices, will become applicable as of February 2, 2025.

Fines under EU Regulation 2016/679 setting forth the General Data Protection Regulation (GDPR) can be up to €35 million or 7% of total worldwide annual turnover. By comparison, the maximum fine under the EU Regulation 2016/679 on the General Data Protection Regulation (GDPR) is €20 million or 4% of total worldwide annual turnover, thus the risk of non-compliance with the EU AI Act will be almost double that of the GDPR.

The EU AI Act is a complex and comprehensive piece of legislation that will have far-reaching effects on the development and use of AI systems within the EU. It is essential for entities to be well informed about the Act's requirements and to begin preparing for compliance.