The EU AI Act sets a global precedent in AI regulation, emphasizing human rights in AI development and implementation of AI systems. While the eventual law will directly apply to EU countries, its extraterritorial reach will impact global businesses in profound ways. Global businesses producing AI-related applications or services that either impact EU citizens or supply EU-based companies will be responsible for complying with the EU AI Act. Failure to comply with the Act can result in fines up to 7% of global turnover or €35m for major violations, with lower penalties for SMEs and startups.
