UNDERSTANDING THE EU AI ACT: A NEW

ERA IN AI REGULATION IN EUROPE

VICTOR HABIB LANTYER1

The "EU AI Act" marks a significant and pioneering step towards the
regulation of Artificial Intelligence (AI) within the European Union. Proposed by the
European Commission, this Act is one of the first major legal attempts to regulate AI in
a significant economic region, aligning with the OECD's definition of an AI system.
The Act aims to create a comprehensive legal framework to regulate the use and
development of AI, ensuring better conditions for both its development and application
across various sectors.

This regulation, emerging as part of the EU's digital strategy, seeks to analyze
and categorize AI systems based on the risk they pose to users. The varying levels of
risk will determine the extent of regulation required. Upon approval, these regulations
will set a global precedent, being the first of their kind to govern AI.

On December 8, 2023, the European Parliament reached a provisional

agreement on the rules for regulating AI use. This agreement puts the EU on track to
become the first major power to enact specific AI laws. The negotiations, lasting nearly
15 hours following almost a day of debate, signify the intensive efforts undertaken to
reach this agreement.

Transparency and Compliance for AI Models: The agreement requires

that basic AI models, like ChatGPT, fulfill transparency obligations before
being made available on the market. This includes the development of
technical documentation, compliance with EU copyright laws, and
disclosure of information about the content used in training.

Risk Assessment and Management: High-impact AI models with systemic

risk must undergo version assessments, analysis and mitigation of systemic
risks, adversarial testing, report serious incidents to the European
Commission, ensure cybersecurity, and energy efficiency.
1
Lawyer, Professor, and Researcher in Digital Law, AI, Intellectual Property, and LGPD (General Data
Protection Law). Author of the books "LGPD and Its Impacts on Labor Law" and "Digital Law and
Innovation". Founder of Lantyer Educacional (lantyer.com.br). Winner of the I Ericsson Award for
Academic Production in Intellectual Property.
 Use of Biometric Surveillance by Governments: The use of real-time
biometric surveillance in public spaces will be restricted to specific
situations, such as searching for victims of certain crimes, preventing
terrorist threats, and searching for suspects of serious crimes.

Biometric Categorization Systems: Prohibits systems that use sensitive

characteristics, such as political, religious, philosophical beliefs, sexual
orientation, and race.

Indiscriminate Scraping of Facial Images: Prohibits the untargeted

collection of facial images from the internet or surveillance cameras to
create facial recognition databases.

Emotion Recognition: Prohibits the use of emotion recognition in the

workplace and in educational institutions.

Social Scoring: Prohibits social scoring systems based on social behavior or

personal characteristics.

Manipulation of Human Behavior: Prohibits AI systems that manipulate

human behavior to circumvent free will.

Prohibitions and Consumer Rights: The agreement prohibits practices

such as cognitive-behavioral manipulation, indiscriminate elimination of
facial images, and creation of social scoring rankings. It also guarantees
consumers the right to make complaints and receive explanations.

Penalties for Violations: Fines for violations of the rules can range
between 7.5 million euros and 35 million euros.

The 'EU AI Act' (European Union Artificial Intelligence Act) has significant
implications for both the AI industry and users of these technologies. Currently, the EU
AI Act does not have an immediate effect for users of generative AI tools. The law will
come into effect and begin to have an impact no earlier than 2026.

Unless the specific generative AI tool falls into one of the regulated risk
categories, it is unlikely that there will be a direct impact on users. Tools used for
creative purposes, such as Midjourney, StableDiffusion, Runway, Pika, etc., probably
do not fall into any of the relevant risk categories. Biometric Identification Systems for
Law Enforcement: Allows use with strict safeguards."

1. HIGH-RISK SYSTEMS
In the context of the "EU AI Act" (European Regulation on Artificial
Intelligence), high-risk systems refer to artificial intelligence applications whose use
implies a significant potential to cause harm or adverse impacts on the fundamental
rights of individuals or on society as a whole. These systems are subject to more
stringent regulations and supervision due to their potentially high impact. Let's better
understand what constitutes a high-risk system according to the EU AI Act:

We can cite as characteristics of high-risk systems:

Impact on Fundamental Rights: Systems that can significantly affect

privacy, personal security, rights to non-discrimination, or that may
significantly impact other fundamental rights.

Use in Critical Sectors: Systems used in sectors such as health,

transportation, energy, and essential parts of public administration, where
errors or malfunctions can have serious consequences.

Sensitive Applications: Include systems used for credit assessment,

recruitment, access to educational services, or essential services such as
energy and water distribution systems.

Surveillance and Identification Systems: Include biometric recognition

technologies, especially when used in public spaces or for mass surveillance
purposes.

The main obligations of these systems, imposed by the new European

legislation, are:

Fundamental Rights Impact Assessment: Mandatory for high-risk

systems, including sectors such as insurance and banking.

Risk Classification: AI systems that influence elections are classified as

high risk.

Right to Complaint and Explanation: Citizens can file complaints and

receive explanations about decisions that affect their rights.
 Strict Assessment and Compliance: Before being placed on the market,
these systems must undergo a strict compliance assessment to ensure they
meet the requirements of the regulation.

Documentation and Transparency: Must have detailed documentation

about the functioning, methodology, data sources used, and measures taken
to ensure compliance with ethical and legal standards.

Risk Mitigation: Implementation of robust measures to mitigate risks,

including bias and discrimination, as well as ensuring data security and
privacy.

Supervision and Enforcement: Will be subject to greater supervision by

regulatory authorities.

Examples of high-risk systems include:

AI Systems in Medical Devices: Systems that assist in diagnosing or

treating diseases.

Traffic Monitoring Systems: Used for the management and control of

urban and road traffic.

Credit Risk Assessment Systems: Used by banks and other financial

institutions to assess clients' solvency.

Recruitment Systems: AI tools used to select candidates for jobs.

The main objective of this classification is to ensure that AI systems with the
greatest potential for negative impact are developed and used responsibly, ensuring
safety, privacy, non-discrimination, and respect for human rights. The risk-based
approach aims to provide a balance between promoting technological innovation and
protecting individuals and society.

The AI Act is an important step in ensuring that AI is used ethically and

responsibly, with a specific focus on protecting human rights and promoting innovation.
This regulation paves the way for safer and more reliable AI development, benefiting
startups and researchers in the EU, and setting a model for the rest of the world.
 However, the evolution of legislation and the implementation of specific
requirements, especially in relation to copyrights and transparency, may have future
implications that AI users and operators will need to follow and adapt to.

2. COPYRIGHTS AND GENERATIVE AI TOOLS IN

EUROPEAN REGULATION
The European Union is adopting a significant regulatory approach to generative
AI tools, particularly in relation to copyrights, with the AI Act (European Regulation on
Artificial Intelligence). This regulation proposes a framework that demands greater
transparency from companies implementing generative AI tools, like ChatGPT 2.
Companies will be required to disclose any copyrighted material used in the
development of their systems3.

A crucial aspect of this new regulation is its risk-based approach. It classifies AI

tools according to the level of perceived risk, ranging from minimal to unacceptable,
with corresponding regulatory requirements. 4. For example, very low-risk AI uses with
little impact on individuals will have minimal regulation, while those in high-risk areas,
such as biometric surveillance or decision-making on health or legal matters, will be
under intense scrutiny5. Although high-risk tools are not banned, they will require high
levels of transparency about how they function and are trained6.

The copyright aspect of the AI Act, specifically related to generative AI, aligns
with the Text and Data Mining (TDM) Guidelines of the DSM Directive (Copyright
2
MUKHERJEE, Supantha; CHEE, Foo Yun; COULTER, Martin. EU proposes new copyright rules for
generative AI. Reuters, Stockholm, Apr. 28, 2023. Available at: https://www.reuters.com/technology/eu-
lawmakers-committee-reaches-deal-artificial-intelligence-act-2023-04-27/ . Accessed on: Dec. 10, 2023;
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content. Techmonitor, [no
location], Apr. 28, 2023. Available at: https://techmonitor.ai/technology/ai-and-automation/generative-
ai-european-union-eu-copyright. Accessed on: Dec. 10, 2023.
3
MUKHERJEE, Supantha; CHEE, Foo Yun; COULTER, Martin. EU proposes new copyright rules for
generative AI. Reuters, Stockholm, Apr. 28, 2023. Available at: https://www.reuters.com/technology/eu-
lawmakers-committee-reaches-deal-artificial-intelligence-act-2023-04-27/ . Accessed on: Dec. 10, 2023;
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content. Techmonitor, [no
location], Apr. 28, 2023. Available at: https://techmonitor.ai/technology/ai-and-automation/generative-
ai-european-union-eu-copyright. Accessed on: Dec. 10, 2023.
4
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content. Techmonitor, [no
location], Apr. 28, 2023. Available at: https://techmonitor.ai/technology/ai-and-automation/generative-
ai-european-union-eu-copyright. Accessed on: Dec. 10, 2023.
5
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content. Techmonitor, [no
location], Apr. 28, 2023. Available at: https://techmonitor.ai/technology/ai-and-automation/generative-
ai-european-union-eu-copyright. Accessed on: Dec. 10, 2023.
6
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content. Techmonitor, [no
location], Apr. 28, 2023. Available at: https://techmonitor.ai/technology/ai-and-automation/generative-
ai-european-union-eu-copyright. Accessed on: Dec. 10, 2023.
Directive in the Digital Single Market)7. These guidelines provide mandatory exceptions
related to TDM for scientific research purposes and for reproductions and extractions of
works/subjects legally accessed for TDM purposes8. The new exception is subject to
reservation by rights holders, which can be indicated by "machine-readable means,"
such as metadata and terms and conditions of a website or service9 .

Furthermore, EU legislation on AI is being adapted to reflect the new landscape

created by the launch of ChatGPT and the increase in the use of generative AI tools 10.
As part of the final agreement of the bill, lawmakers reached a compromise to be in a
middle ground between ignoring copyrights and prohibiting the use of copyrighted
content in training AI models11. The new regulations require the disclosure of any
copyrighted material, such as images or novels, used to train a foundation model12.

The act requires that general-purpose AI systems (GPAI) adhere to transparency

requirements. This includes the development of technical documentation, compliance
with EU copyright laws, and dissemination of detailed summaries about the content
used for training. AI operators must provide a sufficiently detailed summary of the
copyrighted material used as training data. This could pave the way to compensate the
creators of the works used.

7
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content. Techmonitor, [no
location], Apr. 28, 2023. Available at: https://techmonitor.ai/technology/ai-and-automation/generative-
ai-european-union-eu-copyright. Accessed on: Dec. 10, 2023.
8
QUINTAIS, João Pedro. Generative AI, Copyright and the AI Act. Kluwer Copyright, [s. l.], 9 maio 2023.
Disponível em: https://copyrightblog.kluweriplaw.com/2023/05/09/generative-ai-copyright-and-the-ai-
act/ . Acesso em: 10 dez. 2023.
9
QUINTAIS, João Pedro. Generative AI, Copyright and the AI Act. Kluwer Copyright, [s. l.], 9 maio 2023.
Disponível em: https://copyrightblog.kluweriplaw.com/2023/05/09/generative-ai-copyright-and-the-ai-
act/ . Acesso em: 10 dez. 2023.
10
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content. Techmonitor, [s.
l.], 28 abr. 2023. Disponível em: https://techmonitor.ai/technology/ai-and-automation/generative-ai-
european-union-eu-copyright. Acesso em: 10 dez. 2023.
11
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content. Techmonitor, [s.
l.], 28 abr. 2023. Disponível em: https://techmonitor.ai/technology/ai-and-automation/generative-ai-
european-union-eu-copyright. Acesso em: 10 dez. 2023.
12
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content. Techmonitor, [no
location], Apr. 28, 2023. Available at: https://techmonitor.ai/technology/ai-and-automation/generative-
ai-european-union-eu-copyright . Accessed on: Dec. 10, 2023.
 The regulation offers an opt-out mechanism for copyright holders, allowing
them to exclude their works from the training sets of generative AI 13. This is particularly
relevant for creators who wish to maintain control over how their works are utilized14

This regulatory approach of the EU represents a balance between protecting the

rights of citizens and fostering innovation and economic growth, positioning itself as a
landmark in the global AI regulation landscape. Yet, the specific implications of these
regulations, especially in relation to copyrights and transparency, will continue to
evolve and require ongoing adaptations by AI users and operators.

3. FINAL CONSIDERATIONS
The "EU AI Act" represents an initial and significant step towards
comprehensive regulation of artificial intelligence (AI) within the European Union.
While this act marks progress in how AI is approached from a regulatory standpoint, it
is important to recognize that there is still a long way to go. The current legislation,
although pioneering, is just the beginning of an ongoing and dynamic process that needs
to evolve alongside the rapid expansion and constant changes in the field of AI.

The current regulation addresses critical aspects such as transparency,

copyrights, and risks associated with the use of AI, establishing a framework for the
safe and ethical use of these technologies. However, given the complex and ever-
evolving nature of AI, the regulation will need continuous updates and adaptations to
keep pace with technological advancements, new ethical challenges, and emerging
social implications.

Moreover, the regulation needs to be flexible enough to foster innovation and

not restrict the creative potential and technological development that AI can offer. This
implies a delicate balance between regulation and freedom of innovation, ensuring that
Europe remains competitive in the global technological landscape, while protecting the
interests and rights of its citizens.

The "EU AI Act" also highlights the importance of international collaboration in

setting standards and norms for AI. With AI becoming a dominant force in nearly every
13
QUINTAIS, João Pedro. Generative AI, Copyright and the AI Act. Kluwer Copyright, [no location], May
9, 2023. Available at: https://copyrightblog.kluweriplaw.com/2023/05/09/generative-ai-copyright-and-
the-ai-act/ . Accessed on: Dec. 10, 2023.
14
QUINTAIS, João Pedro. Generative AI, Copyright and the AI Act. Kluwer Copyright, [no location], May
9, 2023. Available at: https://copyrightblog.kluweriplaw.com/2023/05/09/generative-ai-copyright-and-
the-ai-act/ . Accessed on: Dec. 10, 2023.
sector, from healthcare to transportation and education, a coordinated and global
approach to regulation is vital, which will help shape the future of technology in a
responsible and ethical manner.

Therefore, the "EU AI Act" is an important milestone, but it is only the

beginning of a complex and necessary regulatory journey. As AI continues to integrate
deeply into our lives and shape the future of technology across all sectors, the need for
adaptable and evolving regulation will become increasingly critical. This act signals the
EU's recognition of the importance of this task and lays the groundwork for future
regulatory developments in this vital and dynamic area.

REFERÊNCIAS
MORRISON, Ryan. EU says generative AI makers must declare copyrighted content.
Techmonitor, [no location], Apr. 28, 2023. Available at:
https://techmonitor.ai/technology/ai-and-automation/generative-ai-european-union-eu-
copyright . Accessed on: Dec. 10, 2023.
MUKHERJEE, Supantha; CHEE, Foo Yun; COULTER, Martin. EU proposes new
copyright rules for generative AI. Reuters, Stockholm, Apr. 28, 2023. Available at:
https://www.reuters.com/technology/eu-lawmakers-committee-reaches-deal-artificial-
intelligence-act-2023-04-27/ . Accessed on: Dec. 10, 2023.
QUINTAIS, João Pedro. Generative AI, Copyright and the AI Act. Kluwer Copyright,
[no location], May 9, 2023. Available at:
https://copyrightblog.kluweriplaw.com/2023/05/09/generative-ai-copyright-and-the-ai-
act/ . Accessed on: Dec. 10, 2023.