Observed Signal · May 22, 2023 · Policy Update · Source: Trending Topics · Impact: 4/5 · Sentiment: Negative
EU AI Act Amendments: Good, Bad and Ugly for Startups
The guest article by Franziskos Kyriakopoulos, CEO of Austrian AI startup 7Lytix, analyzes the European Parliament committees' amendments to the EU AI Act and their consequences for startups and SMEs. The revised text narrows the definition of AI by aligning it with the OECD definition, classifies biometric, educational, workplace, and access-related AI systems as high-risk, and treats AI used for candidate selection or targeted job advertisement placement as high-risk. Foundation models such as GPT-4 are not automatically high-risk but would require documentation of training data, energy consumption, and accuracy, plus registration in an EU-wide database. Fines for serious violations would rise to €40 million or 7% of annual turnover. The author warns of certification bottlenecks and recommends early documentation, legal review, and compliance preparation during the two-year implementation period.
EU AI Act amendments define high-risk AI use cases including recruitment advertising, impose documentation and registration duties for foundation models, and raise penalties to €40 million or 7% of turnover, creating material compliance and product implications for AI and AdTech companies operating in Europe.
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Key Takeaways & Evidence Grounding
- Two committees of the European Parliament published amendments to the original EU AI Act after months of negotiations.
- The revised AI definition aligns with the OECD and covers machine-based systems generating predictions, recommendations, or decisions.
- AI systems used for candidate selection or targeting job advertisements are classified as high-risk and require certification.
- Foundation models such as GPT-4 would require documentation of training data, data provenance, energy consumption, and accuracy, plus EU-wide registration.
- Fines for serious AI Act violations would increase to up to €40 million or 7% of global annual turnover.
Connected Companies & Entities
1 Entity mapped“Sam Altmann, the founder of OpenAI, spoke in favor of regulation and licenses for models at a US congressional hearing....”
Ontology Mapping & Concepts
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