Navigating the New Phase of the EU AI Act: Compliance Obligations for Organizations

As of February 2, 2025, the European Union's Artificial Intelligence Act (EU AI Act) has entered a new phase, bringing with it a set of mandatory obligations for organizations operating within or interacting with the EU market. This landmark regulation aims to ensure that AI systems are safe, transparent, and human-centric, fostering trust and innovation in AI technologies.

However, the EU AI Act should not be your only driver... Remember the case where an organization implemented an AI-driven chatbot to handle customer service inquiries. However, due to a lack of understanding of AI, the chatbot frequently provided incorrect or irrelevant responses, frustrating customers and damaging the company's reputation. On top the chatbot mentioned that their competitor had better service... Imagine the investment in extensive retraining and redesign of the chatbot and the cost to restore customer trust.

So, let's look at some of the key compliance obligations:

Key Compliance Obligations:

1. AI Literacy Training: One of the most immediate and impactful requirements is the AI literacy mandate. Organizations must ensure that all personnel working with AI systems are adequately trained in AI governance, risks, and ethical considerations. This obligation applies to all AI users, even those engaging with low-risk AI applications. Implementing comprehensive AI training programs is essential to meet this requirement.
2. Prohibited AI Practices: The Act imposes an outright ban on AI systems that pose an "unacceptable risk." These include AI applications that manipulate behavior, exploit vulnerabilities based on age, disability, or social status, use biometric categorization to infer sensitive attributes, engage in social scoring practices, conduct mass scraping of biometric data, and infer emotions in workplaces and educational institutions, except for strictly regulated safety applications. Organizations must assess their AI-driven tools to ensure they do not fall under these banned categories.
3. Risk-Based Classification: The EU AI Act categorizes AI systems into four risk levels, determining the degree of regulatory scrutiny and compliance obligations:

Steps to Ensure Compliance:

• Develop AI Training Programs: Implement AI literacy training for all employees interacting with AI systems. This includes lawyers, compliance teams, and support staff.
• Establish AI Governance Structures: Develop internal policies to ensure responsible AI usage and compliance with regulatory frameworks. Establish AI governance structures to oversee AI usage and maintain compliance with EU regulations.
• Conduct Risk Assessments: Regularly assess AI systems to identify and mitigate risks. Ensure that high-risk AI systems undergo thorough risk assessments and comply with transparency and human oversight requirements.
• Monitor and Update AI Practices: Continuously monitor AI practices to ensure ongoing compliance with the EU AI Act. Update AI systems and practices as necessary to align with evolving regulatory requirements.

By taking these steps, organizations can navigate the new phase of the EU AI Act and ensure compliance with its obligations, fostering a safe and trustworthy AI ecosystem.