EU AI Act
Last Updated: July 29, 2026 | By Mihail Sebastian | AI Dictionary
The European Union's comprehensive AI regulation, in force since August 2024, which sorts AI systems into risk tiers and scales legal duties to match.
What is the EU AI Act?
The EU AI Act is the European Union’s comprehensive AI regulation: it sorts AI systems into risk tiers and scales legal obligations to match, from outright prohibition down to no new duties at all. It entered into force in August 2024 as the first comprehensive AI statute anywhere.
Its reach extends beyond Europe. The Act applies to providers and deployers outside the EU whenever their system’s output is used in the EU, which is why it shapes compliance programs worldwide.
How the EU AI Act Works
The Act’s core is its four risk tiers.
- Prohibited practices: Uses judged incompatible with fundamental rights are banned, including social scoring by public authorities and real-time remote biometric identification in public spaces, the latter with narrow law-enforcement exceptions.
- High-risk systems: AI used in areas such as hiring and CV screening, credit scoring, medical devices, and law enforcement must meet requirements for risk management, data governance, technical documentation, and human oversight, and pass a conformity assessment before reaching the market.
- Transparency obligations: Systems that interact with people or generate content carry disclosure duties: a chatbot must reveal that it is one, and AI-generated media must be identifiable as such.
- Minimal risk: Everything else, from spam filters to game AI, faces no new obligations.
Providers of general-purpose AI models, the models behind chatbots and generative tools, carry a separate set of documentation and transparency duties. The Act applies in phases: the prohibitions took effect first, in early 2025, and most high-risk obligations follow over subsequent years.
Penalties scale with severity, up to €35 million or 7% of worldwide turnover for prohibited practices and €15 million or 3% for most other violations. In this dictionary’s vocabulary, the Act’s text is AI law; the standards, guidance, and market surveillance being built around it are AI regulation.
Example of the EU AI Act
Consider a software company selling three products into the EU. Its spam filter sits in the minimal-risk tier: nothing changes.
Its customer-service chatbot triggers a transparency duty: users must be told they are talking to a machine. Its CV-screening tool is high-risk: before selling it, the company must set up risk management, document the training data, build in human oversight, pass a conformity assessment, and register the system in an EU database.
One legal act, three outcomes, because obligations attach to the AI use case, not to the company. Our post on the Act’s implications for tech companies covers what this means in practice.
FAQ
Does the EU AI Act apply to companies outside the EU?
Yes. The Act covers providers and deployers based anywhere when their AI system is placed on the EU market or its output is used in the EU. A US vendor selling a hiring tool to a German customer carries the same high-risk obligations as a European one.
Is ChatGPT banned under the EU AI Act?
No. General-purpose AI models are not prohibited; their providers face documentation and transparency obligations instead. The prohibitions target specific practices, such as social scoring, not general-purpose tools.
Related AI terms: AI Law · AI Regulation · Compliance · AI Governance · AI Risk
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Mihail Sebastian — Writes about AI governance, regulation, and the technology behind them. Placeholder bio — replace with a real credential line. About