EU Passes Landmark AI Legislation, Leaves U.S. Trailing Behind

Key takeaways

• The European Parliament has become the first governing body to pass an AI regulation law, the AI Act
• Breaches of the Act could cost Big Tech billions as they stand to be fined up to 6% of their global annual revenue for breaking the new law
• The U.S. and China are trailing behind, but .US legislation has been slated for the fall

The EU has made a landmark decision on the future of AI this week by passing the AI Act, the first of its kind from any governing body. The Act has outlawed social scoring and predictive policing and holds hefty fines for those deemed to have broken the law. It leaves the U.S. and China superpowers in the dust, but the U.S. says regulation is coming this year.

AI has been a driving factor in the stock market’s rally this year as Big Tech jumps on the bandwagon. You can use AI to invest in the companies helping to progress the latest innovations with Q.ai’s Emerging Tech Kit, where the algorithm scans a hefty amount of data each week to predict the best performers, then dynamically realigns the Kit’s holdings to help you build wealth.

Download Q.ai today for access to AI-powered investment strategies.

What has the EU passed?

On Wednesday, the European Parliament passed the EU Artificial Intelligence Act in a world first towards setting comprehensive rules around regulating AI technology and its development. It first came into fruition in 2021, but the Act has been sped up to combat the explosive rise of ChatGPT.

The new Act identifies four risk levels for AI, with social scoring and predictive policing tools ruled to be unlawful. Companies must abide by greater privacy standards and transparency laws, or face steep fines: the worst offenders could be fined up to 6% of their annual global revenue.

EU member states will need to enforce the laws themselves, with the AI Act acting as some much-needed guardrails for developing AI in Europe.

What’s happening with AI regulation in the U.S.?

Since the dawn of generative AI has been upon us, global leaders have announced intentions to regulate the tech. The U.S. first released its Blueprint for an AI Bill of Rights last year’, with China soon publishing a set of draft rules to regulate AI afterwards.

In May, a bipartisan congressional committee heard from AI leaders including OpenAI founder Sam Altman, IBM chief privacy officer Christina Montgomery and psychologist Dr Gary Marcus on the potentials and perils of AI. “My worst fears are that [the AI industry] cause significant harm to the world,” Altman, the creator of ChatGPT, said.

The Senate also hosted the first of three briefings for its members this week to help senators understand the tech they’re looking to regulate. He also confirmed legislation is expected in the fall that could feature a standardized set of AI safety rules and an independent regulator, as suggested by the AI experts last month.

The bottom line

A step towards AI regulation is good news for companies and investors alike — operating within guidelines now will help control AI’s potential lightning-fast development. In turn, it should build trust in the public on how AI can help them in their daily lives (like investing, for instance).

AI isn’t new to hedge funds — they’ve used machine learning for years. But now you can, too, with Q.ai’s Emerging Tech Kit. It’s powered by an AI that sifts through the data to predict which tech stocks and ETFs could perform well, then re-weight your investment in the Kit to help you catch the upside without the upfront work.

Download Q.ai today for access to AI-powered investment strategies.