On August 2, the EU AI Act will introduce its key rules for models of general-purpose AI. Some key stakeholders have called for a delay in the roll-out due to growing concerns that too much regulation could undermine Europe’s competitiveness. These include the Swedish Prime Minister Ulf Kristersson, Bosch CEO Stefan Hartung, and the tech lobbying groups CCIA Europe, which includes Alphabet, Meta and Apple.
Eoghan O’Neill from the AI Office at the European Commission addressed the issue of a possible delay in the roll-out of the technology on the 20th of June, during the TNW Conference held in Amsterdam. He clarified that the Commission intends to finalise their rules for GPAI by July. The European Parliament will then adopt a position on the standards.
This is a sophisticated, large technology, and we are trying to get it right. “We need to have specific obligations under the AI Act that capture some of the models that are most harmful or impactful.”
O’Neill emphasized the guidelines were written by a large code of practice group. The group included academics, AI experts, SMEs and European industrial giants. He said, “It’s a big tent that includes all those voices from the stakeholder communities”.
Tech experts, however, warned the EU that it needed to reduce its regulation burdens.
Fabrizio del Maffeo, CEO of Axelera AI in the Netherlands, said that “Europe is not like the United States”. “We have many different languages, markets, and regulations – both European, and local.” These barriers stifle growth, as they create borders and make it difficult for businesses to expand.
Del Maffeo stated that his company had signed a petition for “EU Inc,” which is a proposal for a standardised legal entity to be created for startups to allow easier operations across EU members states.
EU Inc will be part of the 28th regime in the EU, a pan European legal framework that is designed to help startups grow throughout the union. In a speech to the Davos Economic Forum in January, Commission president Ursula von der Leyen ( ]]said that these rules would combine [and] corporate law, insolvency law, labour law and taxation in “one simple framework.” But regulation isn’t the only issue, Del Maffeo emphasized. Del Maffeo argues that the obsession with launching new businesses must be balanced by a focus on scaling up existing ones. This, he argues, requires more capital than policy.
The numbers back him up: Europe is responsible for only 8% the world’s scaling-ups, while North America accounts for 60%. No EU-founded startup has ever exceeded a EUR100bn valuation in the last 50 years. The region is home to countless innovations but struggles to transform them into large businesses.
He said, “If you look at the machine builders in the world, we are leading.” “In automotive, our performance is excellent, but we’re losing ground.” In robotics we are doing great, but also losing traction.
Peter van der Putten echoed the same view. He is director of Pegasystems’ AI Lab and a lead scientist. He said that the EU must become more attractive to investors, both domestically and internationally.
Funding figures highlight the investment gap. European startups raised $ 52BN (EUR44bn), in venture capital, last year. This is far less than their US counterparts who raised $ 209BN (EUR177BN). Van der Putten Stated That “Investment may come from the EU but also the US.” “Regulations can be changed to make it easier for funding to leave the US and flow into Europe.”
Europe, according to Elise de Reus of Cradle, is also in a great position to attract talent from the US. She pointed out a growing trend of European engineers returning to Big Tech jobs in America, attracted by purpose-driven employment and a better quality of living. She said
: “We welcome European engineers who worked at Big Tech companies in the US like Facebook to come back and help solve societal and global issues such as climate changes.”
We’re also perhaps a little too modest. We should measure happiness and not GDP. This is a more sustainable metric. I don’t believe we should copy the American system.”
