Europe regulates AI: What does it mean for UK business?
On April 21, the European Commission (EC) presented its regulatory text with a proposal for a European regulation on Artificial Intelligence (AI). The objective is to protect citizens from harmful AI, with practices identified as “unacceptable risk,” including facial recognition in public places and social scoring, outright banned. So-called high-risk AI practices surrounding essential private and public services will have to be demonstrated as safe, while limited risk systems (such as chatbots) will be subjected to transparency obligations to ensure users are able to make informed decisions regarding their use.
As part of this regulation, companies will be forced to assess AI risks and incorporate explainability. In the event of non-compliance, fines may reach six percent of the company's annual turnover.
It’s a first-of-its-kind initiative set to strongly influence AI development and deployment standards globally, comparatively similar to how the EU General Data Protection Regulation (GDPR) began to influence data protection when it became binding in 2018.
While the new regulations may be first and foremost focused on any user of AI systems in the EU, the crossover into the UK is inevitable. The regulations also apply to any company, based anywhere, that sells products and services into the EU, as well as providers and users of AI systems where the output produced by the system is used in the EU.
Beyond that, the UK is doing extensive work surrounding AI auditing and explainability frameworks via the Information Commissioner’s Office, while the government recently announced a new strategy to make the UK a global center for the development, commercialization and adoption of responsible AI. The FCA and Alan Turing Institute are also working on a year-long collaboration on AI transparency in relation to machine learning in financial markets.
With so much crossover between the users of products and services in the EU and UK, and, with all signs pointing to increased AI regulation in the UK in the near future, what should businesses be doing to prepare to ensure they comply and continue to drive innovation in AI?