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European Companies Voice Concerns Over EU’s AI Act, Citing Threats to Technological Sovereignty

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European Companies Challenge EU’s AI Act, Citing Technological Sovereignty Concerns

Several prominent European companies have joined forces to criticize the European Union’s recently approved regulations on artificial intelligence (AI).

In an open letter addressed to the European Parliament, Commission, and member states, over 150 executives from companies like Renault, Heineken, Airbus, and Siemens expressed their reservations, claiming that the AI Act could jeopardize Europe’s competitiveness and technological sovereignty.

AI Act Approval and Ongoing Legislative Process

After two years of development and expansion to include cutting-edge AI advancements, such as large language AI models (LLMs) and foundation models like OpenAI’s GPT-4, the European Parliament approved a draft of the AI Act on June 14th.

However, several phases remain before the law can take effect, with inter-institutional negotiations expected to conclude later this year.

Criticisms of the AI Act’s Impact on Technological Advancement

The signatories of the open letter argue that the current state of the AI Act could stifle Europe’s opportunity to reclaim its position at the forefront of technology. They contend that the approved rules are overly stringent and may hinder the bloc’s technological ambitions rather than fostering an environment conducive to AI innovation.

Concerns Surrounding Generative AI Systems and Compliance Burdens

Major concerns raised by the companies relate to the AI Act’s specific regulations targeting generative AI systems, a subset of AI models falling under the “foundation model” category.

The legislation requires providers of foundation AI models, regardless of their intended application, to register their products with the EU, undergo risk assessments, and meet transparency requirements.

The signatories argue that these provisions impose disproportionate compliance costs and liability risks, potentially leading AI providers to exit the European market altogether.

Calls for Balanced Approach and Industry Expert Involvement

The open letter urges EU lawmakers to reconsider the stringent compliance obligations for generative AI models and instead adopt a risk-based approach that accommodates broader principles.

Additionally, the companies propose the establishment of a regulatory body comprising AI industry experts to monitor the application of the AI Act as technology continues to evolve.

Reactions and Future Outlook

Dragoș Tudorache, a Member of the European Parliament involved in developing the AI Act, responded to the letter, dismissing the concerns raised by the signatories.

Tudorache emphasized that the legislation offers an industry-led process, standards definition, governance with industry involvement, and a light regulatory framework focused on transparency.

Meanwhile, OpenAI, which played a role in advocating for changes to the earlier draft, has previously expressed its commitment to the European market, despite initial concerns about compliance with EU regulations.


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