The EU’s landmark AI Act enters a new phase this week, as regulators begin enforcing rules requiring companies to label AI-generated content and disclose when users are interacting with the technology.
From August 2, the European Commission's AI Office, alongside national authorities, started enforcing key provisions of the bloc's new rules. The measures introduce new transparency obligations for general-purpose AI models, including chatbots, and roll out bans on a range of prohibited practices.
Under the next phase, businesses must clearly inform users when they are interacting with AI rather than a human. AI-generated or manipulated content — including deepfakes — must also be labelled, with certain content required to carry machine-readable markers that make it easier to identify.
The AI Office will oversee providers of general-purpose AI models, while national regulators will enforce the rules for most other AI systems.
"The AI Act's transparency requirements are wider in scope than most organisations realise," says Marcus Evans, a partner at law firm Norton Rose Fulbright.
"Importantly, this isn't just an issue for the major AI developers — it can also affect organisations rolling out AI tools with their own branding," he adds, warning that businesses should work with technology suppliers to ensure they can meet the new obligations.
Companies found in breach could face fines of up to 3% of their annual global turnover. The rules are expected to increase pressure on US AI companies serving European customers.
"The EU AI Act's new powers, which move from theoretical to operational on Sunday, are causing significant concern for US AI labs," says Peter Van Dyck, partner at law firm A&O Shearman.
"Any lab with European customers now needs to be aware that if its model's outputs reach EU users, it's considered in scope," he adds.
While regulators have the power to levy substantial penalties, Van Dyck expects enforcement to build gradually, with companies initially needing to demonstrate they are actively working towards compliance.
