AIG Newsletter 10 February 2025

NEWS

In this week's edition: IMCO receives progress updates from key working groups on AI and Digital Markets Act Implementation, and discusses Digital Services Act compliance with DG CONNECT. IMCO also releases its AI Liability directive draft opinion, which effectively rejects the Commission's proposal. The EC unveils its eagerly awaited Competitiveness Compass. Meanwhile, ITRE engages in dialogue with Executive Vice President Virkkunen on the Competitiveness Compass. The EU's AI Act comes into force, accompanied by guidelines on prohibited practices and AI system definitions. Finally, the US House Judiciary writes to Virkkunen demanding detailed information about the EU's Digital Services Act.

PROGRESS UPDATES ON AI, DIGITAL MARKETS AND DIGITAL SERVICES ACTS

On 27 January, IMCO received updates from Brando Benifei (S&D) on the AI Act Working Group's progress, which highlighted discussions about general-purpose AI guidelines. On 28 January, Andreas Schwab (EPP) (Chair of the Digital Markets Act Implementation Working Group), noted a constructive first meeting and drafted a letter urging the EC to enforce Digital Market Act rules rigorously. Additionally, IMCO exchanged views with DG Connect about Digital Service Act compliance, emphasising the need for platform transparency, content moderation, and protection against illegal online content. 

EP IMCO RELEASES OPINION ON THE AI LIABILITY DIRECTIVE

On 31 January, IMCO published its draft opinion on the AI Liability Directive. Rapporteur Zlotowski (ECR) recommended rejecting the Commission's proposal. He argued that the directive was premature, and cited the existing AI Act and revised Product Liability Directive as sufficient regulatory frameworks. At the same time he expressed concerns about the lack of concrete data in the Commission's assessment and the potential negative impact on innovation and competitiveness.

EC ANNOUNCES ITS COMPETITIVENESS COMPASS

On 29 January, the EC published its highly anticipated Competitiveness Compass. The document identifies three areas for action: closing the innovation gap, establishing a decarbonisation roadmap, and reducing dependencies. These areas are further supported by five horizontal enablers including simplification, Single Market improvements, financing, skills promotion, and policy coordination. The Commission will start work with the Omnibus Simplification Package on 26 February, focusing on sustainability reporting and due diligence legislation, and will publish an Annual Single Market and Competitiveness Report to monitor progress.

EP ITRE EXCHANGES VIEWS WITH COMMISSIONER VIRKKUNEN

On 29 January, ITRE held a dialogue with Executive Vice President Virkkunen, who presented the Competitiveness Compass, and outlined strategic investments in AI, cloud technologies, and telecommunications. She highlighted the importance of bridging innovation gaps, simplifying regulations, and reducing reliance on non-EU technologies. As well as the importance of addressing challenges such as international competition, cybersecurity concerns, and better digital infrastructure and connectivity. 

THE AI ACT ENTERS INTO FORCE

On 2 February, the initial rules of the EU's AI Act came into force, accompanied by the EC's guidelines on prohibited AI practices and AI system definition. The guidelines, whilst not yet formally adopted or legally binding, outlined practices deemed unacceptable due to risks to European values, categorised AI systems based on risk levels, and provided practical examples for compliance. The Commission subsequently published additional guidelines on 6 February specifically addressing AI system definition, helping stakeholders determine whether their software qualifies as an AI system under the Act's framework.

US PUSHES EU FOR ANSWERS ON THE DSA

In a letter addressed to Executive Vice President Virkkunen, US House Judiciary Chair Jim Jordan demanded detailed information about the EU's Digital Services Act by 13 February, expressing grave concerns about the potential global impact on free speech. Jordan argued that the Digital Services Act could effectively impose restrictive content moderation standards worldwide, even though the law technically applied only to the EU.

DATES FOR YOUR DIARY

11 February: EC Annual Work Programme is published

11 February: EDPB holds its 102nd plenary meeting

20 February: Masters of Digital 2025 (Digital Europe)

24 February: Next trilogue on the Green Claims Directive expected to take place

24 February: Digital Week Gibraltar - Action for Impact (Commonwealth Telecommunications Organisation)

26 February: Omnibus Simplification Package (from the Competitiveness Compass) is expected to be announced

11 March: d3con: Rethinking Digital Advertising (IAB Europe)

13 March: AI Ethics and Governance Webinar (The Coimbra Group)