The EU AI Act is the European Union’s comprehensive law on artificial intelligence, the first of its kind globally. It entered into force on 1 August 2024 and classifies AI systems by risk — prohibited, high-risk, limited-risk, and minimal-risk — with most obligations becoming fully applicable on 2 August 2026.
How it works
The Act bans a narrow set of “unacceptable risk” uses outright (e.g., social scoring by governments, certain biometric categorisation), imposes strict conformity-assessment, transparency, data-governance, and human-oversight requirements on “high-risk” systems, and adds lighter transparency rules on general-purpose AI models. Penalties for the most serious breaches can reach up to €35 million or 7% of global annual turnover, whichever is higher.
Why it matters
The Act applies to any provider whose system reaches users in the EU — not just EU-headquartered companies. Together with rapidly expanding US federal and state AI rules, it makes 2026 the year AI compliance becomes a board-level issue. For the broader policy picture see AI Safety & Governance 2026.
Related terms: Generative AI · Foundation Model · Frontier Model · All glossary entries