Truly Risk-Based Regulation of Artificial Intelligence - How to Implement the EU's AI Act

Abstract

The recently adopted Artificial Intelligence Act (AI Act) of the European Union (EU) claims to be based on a risk-based approach to avoid over-regulation and to respect the principle of legislative proportionality. This paper argues that risk-based regulation is indeed the right approach to AI regulation. At the same time, however, the paper shows that important provisions of the AI Act do not follow a truly risk-based approach – contrary to the claims of the European Commission and the co-legislators. Yet, this is nothing that cannot be fixed. The AI Act provides for sufficient tools to support future-proof legislation and to implement it in line with a genuine risk-based approach. Against this background, the paper analyses (i) how the AI Act should be applied and implemented according to its original intention of a risk-based approach, (ii) how the AI Act should be complemented by sector-specific legislation in the future to avoid inconsistencies and over-regulation, and (iii) what lessons legislators around the world can learn from the AI Act in regulating AI.

Keywords: AI Act, AIA, Artificial Intelligence, Risk-based approach, Regulation, EU

JEL Classification: M48