A milestone agreement, but at what cost? Response to the political deal on the EU AI Act

A political agreement has been reached by the three EU institutions on the AI Act, a momentous piece of legislation that can make or break Europe’s tech leadership. By establishing a European AI rulebook, it will play a crucial role in shaping the future of AI in Europe.

DIGITALEUROPE’s Director General Cecilia Bonefeld-Dahl said:

“We have a deal, but at what cost? We fully supported a risk-based approach based on the uses of AI, not the technology itself, but the last-minute attempt to regulate foundation models has turned this on its head.

The new requirements – on top of other sweeping new laws like the Data Act – will take a lot of resources for companies to comply with, resources that will be spent on lawyers instead of hiring AI engineers. We particularly worry about the many SME software companies not used to product legislation – this will be uncharted territory for them.

The AI race is not one Europe can miss out on. We need to think long and hard about how we can compensate for this extra burden and give companies here a fighting chance.”

Despite these concerns, we believe that the AI Act, if done right, can be a positive force for AI uptake and innovation in Europe. Work at a technical level in the coming weeks will be key to addressing remaining issues and clarifying the political orientations. Beyond the AI Act, a lot of work still needs to be done to create the conditions for Europe to become a global leader in AI.

The supporting study to the Commission’s impact assessment highlighted that for an SME of 50 people, compliance would cost around €300,000. We urge the EU institutions to work closely with industry to ensure that companies, particularly smaller ones, have the support they need to comply with the new requirements.