European regulators approve the EU’s Artificial Intelligence Act which could come into effect in either May or June 2024. Yahoo Finance Legal Reporter Alexis Keenan explains the details of this legislation and how similar EU laws can compound on top of one another in an attempt to rein in Big Tech globally.
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Editor’s note: This article was written by Luke Carberry Mogan.
Video Transcript
RACHELLE AKUFFO: Well on Friday, EU officials moved closer to adopting the EU’s Artificial Intelligence Act. It’s the world’s first attempt at comprehensive AI rules. And like the EU tech laws that came before it, the act is expected to impact companies beyond EU borders.
Let’s get to “Yahoo Finance’s” Alexis Keenan, who’s been looking into the EU’s growing influence here. Hey, Alexis.
ALEXIS KEENAN: Hi, Rachelle. Yes. So big news on Friday with the EU’s ambassadors unanimously approving this new AI law. It’s supposed to be this attempt at comprehensively regulating AI and the technologies to come. Expected to be in force in effect, in part, some of its provisions as early as May or June this year.
Now, this approval, though, what it does is it really adds to the EU’s global sway in how companies operate, especially in the tech space on how they use, how they create, and how they distribute their technology. And that’s because the companies that do business either within the EU or with EU consumers, they’re going to have to ask whether they should tailor their products and services to meet the expectations and requirements of these laws, or whether they’re going to go market by market and customize their products and services.
But at the same time, this level of influence, it’s not really new. In 2012, it was coined the Brussels effect by a Columbia University law professor. And that was really to describe the EU as this de facto exporter of its laws and regulations. Because you have to remember, before this EU act, you had GDPR in 2012. I believe it was. 2018, pardon me.
That’s governing data privacy. Then came the Digital Markets Act and the Digital Services Act still now going into effect with the Digital Services Act, just taking effect and having to be complied with in 2024 of January this year.
And then, of course, you had the European Commission and its aggressive pushes against major mergers. You go all the way back to 2001. You had GE and Honeywell’s merger– would be merger derailed $42 billion won there.
You had Amazon and iRobot, just this year, $1.4 billion deal. You add to that Adobe and Figma at the tail end of last year, $20 billion deal. And also, Illumina Grail. This push all coming from the EU that breaking up these big deals.
But the concern, guys, is that the small and medium-sized companies will have trouble complying with these laws. It’s not the big tech companies that will have to contend so much with trying to get it straight. These laws are incredibly, incredibly detailed. And it is difficult to comply.
RACHELLE AKUFFO: Indeed, especially, for these multinational companies trying to balance everything at both ends. But, at least, something of a framework potentially for the US to follow. Appreciate you breaking all of this down for us.
ALEXIS KEENAN: Potentially.
RACHELLE AKUFFO: Our very own, Alexis Keenan.
ALEXIS KEENAN: You bet.
RACHELLE AKUFFO: Yes.
