Artificial Intelligence faces EU regulators: positive or problematic for European investment?

Written by Gemma Allen, Vice President, B2C Technology at IDA Ireland

The hype surrounding AI is so pervasive in all aspects of society nowadays that it is difficult to comprehend. In what seems like a lightning bolt, it has become front and center of all conversations about technology and the future, injecting a grandiose projection of the new possible. The matter turned into something like a media, social and political frenzy. The fuss is not unjustified. You are expected to see AI annual growth at a rate of 37.3% from 2023 to 2030. It is heralded as the next big technological revolution, comparable to the advent of electricity and the Internet.

Unsurprisingly, this has also been a cause for widespread political and social concern, less about the progress it has made, but more about the rapid emergence of regulatory circumvention. Technology giants such as Microsoft, Google, and Amazon Web Services (AWS) have announced what they see as a race to the top, while governments and society are excited, and perhaps anxious, spectators. However, one thing is very clear, which is the lack of clear rules and standards. So far.

The European Union announces a major change

Earlier this year, the European Parliament announced a major change in regulating and monitoring the use of AI through the Artificial Intelligence Act. The planned law places new restrictions on some of the most risky areas of technology use. It blocks the use of facial recognition software and also forces the technology to reveal more about the data used to create its software and larger language models as a whole. This is the first of its kind and is a widely varying approach in the United States, where state governments still struggle to define and enforce legal regulations.

The EU takes a borderline position, and the question remains whether there will be a series of rapid followers. For European technology investors and global multinationals that continue to expand and grow, this creates an interesting dynamic. AI governance is essential, and being at the forefront of AI is a positive step in directing research to address global challenges, enhancing shared oversight, and playing a leading role in sharing best practices and data.

At the cornerstone of the EU AI policy framework is the ambition of the so-called Digital Decade Objectives. This is a public declaration by EU member states that together aim to “empower businesses and individuals in a sustainable, more prosperous, people-centred digital future.” They explained that although this is a continental initiative, it will have a global reach and will be facilitated through partnerships with private industries. The goal is to create a secure and digitally inclusive future for all while strengthening global supply chains and providing global solutions to societal and economic challenges.

For example, countries such as Ireland have developed clear strategies for inclusive ecosystem engagement, forming advisory boards with individuals from academia, business, law, security, social sciences, economics and civil society to provide independent expert advice to government on AI policy. With a particular focus on building public trust and promoting the development of person-centred trust Amnesty International.

Lessons from the past

The timing of the AI ​​law, coupled with the unanimous commitment of major technology companies to reduce the risks and positive impact of AI, represents an interesting intersection. In an effort to keep up and stay ahead, there is spending on research and development across the technology industry reach an unprecedented extent. levels. The tech industry has been down this road before with the mass integration of social media, lack of regulation and the wide-ranging social and political impacts that have followed. Worryingly, artificial intelligence could lead to much more dire consequences. Partnering with bodies such as the European Union and putting subject matter and technical experts at the forefront of the conversation can lead to more informed and valuable outcomes and mitigate future risks. It is not about regulation versus flexibility, but about protecting human values ​​and leading the way toward integrated progress.

The future of artificial intelligence regulation

While the European Union leads the way when it comes to regulating AI, it remains an open question whether the United States will quickly follow suit. What is clear is that it is a topic of great importance to Capitol Hill as evidenced by Senator Chuck Schumer’s call for technology leaders to meet at September 13th. Although there is a marked difference in the pace of legislation, the consequences for global transatlantic business loom large. Companies scaling and developing AI products and solutions in Europe have an opportunity to be part of a testbed built on viable future outcomes and early adopters in the war on technology and integrity.

The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.