What’s Happening & Why This Matters
The changes coming in 2024 include the EU AI Act, litigation trends, and mitigation strategies that will significantly impact US companies. These developments will reshape the landscape and governance of artificial intelligence, affecting how US companies use AI in products and services targeted at EU residents. It’s essential for US companies to understand these changes and take proactive measures to comply with these new regulations.
The Significance of the EU AI Act for US Companies
The EU AI Act will apply to both providers and deployers of AI models, requiring U.S. companies to undergo an extensive series of governance steps, including risk ranking, ensuring high-quality data use, continuous testing and monitoring, risk assessment, technical documentation, transparency requirements, human oversight, and having a failsafe in place. U.S. companies must prepare to adapt their AI tools and governance programs to comply with the Act’s regulations to avoid hefty fines of up to 7% of gross revenue if they fail to adhere to the new obligations.
Challenges and Mitigation of Bias in AI and IP Violations
US companies are likely to face challenges related to potential bias in AI and IP violations. Proactive implementation of AI governance practices is advised to avoid these issues. Continuous testing, monitoring, and auditing of AI will help companies catch and mitigate bias for high-risk use cases, while also ensuring that diverse teams are involved in product development to avoid IP-related legal repercussions. The ongoing litigation of AI tech companies is also a key factor to consider when partnering with vendors to prevent IP-related lawsuits.
As regulatory enforcement threats and growing legislation create an urgency for AI governance standards globally, US companies need to prioritize the implementation of these standards. Boards should look into recent proposed guidance and litigation trends and work to mitigate AI bias risks by maintaining human oversight and ensuring diverse team involvement in algorithm development. The risk of copyright and other IP violation lawsuits should be addressed through continuous testing, monitoring, and auditing use cases, coupled with securing rights to use IP for high-risk applications.
t/f Summary: What’s Next
Expectations for governance and compliance with AI regulations continue to evolve, shaping the future of how US companies operate and manage AI tools. Mitigating AI bias risks, potential IP violations, and ensuring compliance with new regulations will be crucial for US companies moving forward. Boards and CEOs will need to remain proactive in implementing AI governance standards and ensuring they align with emerging regulations and standards.