AI Model Developers Now Required to Adhere to EU Transparency Standards
The European Union has introduced new rules for AI model providers, effective August 2, 2023, as part of the EU AI Act, adopted in May 2024. The rules aim to strengthen copyright laws while maintaining a balance between transparency obligations and the protection of developers' proprietary information.
The new guidelines require AI model developers to document and report the data used in training their models. However, this must be done in a way that respects and protects intellectual property rights (IPR), trade secrets, and confidential business information according to Union and national law.
High-risk AI applications providers are also mandated to keep oversight documentation without compromising their own intellectual property or trade secrets. This measure addresses developers' concerns about IP protection.
However, associations representing creators and rightsholders, particularly from the creative and cultural sectors, have expressed concerns that while the Act formally provides tools for enforcing rights against AI models, the implementation may fall short. They argue that the current enforcement mechanisms and transparency requirements do not sufficiently protect creators' intellectual property.
The European Parliament suggests implementing standardized dataset logs, traceability tools like watermarking or fingerprinting, and statutory remuneration mechanisms for rightsholders to address value sharing and enforce compliance. This would enhance intellectual property protection by enabling end-to-end auditing of content used in AI training.
Under the new rules, operators of AI models must disclose how their systems function and the data used to train them. Developers must also detail the measures taken to protect intellectual property. However, there is no obligation to specify concrete datasets, domains, or sources in the EU guidelines, according to the Initiative for Copyright.
The new rules also allow private individuals to sue providers for violations of the new rules. Penalties for violating the new rules can reach up to 15 million euros or 3% of the company's global annual turnover.
Google has expressed concern about the new rules, but the EU AI Act specifically requires general-purpose AI (GPAI) model developers to document and report the data used in training their models in a way that balances transparency and confidentiality.
The new rules do not take effect until August 2026 for new models and August 2027 for models released before August 2, 2025. The new rules do not address concerns raised by several national and international alliances of authors, artists, and publishers regarding intellectual property protection. These groups call for more effective involvement of creatives in drafting transparency templates and a complete rethink of the implementation approach to truly safeguard IP rights.
[1] European Commission. (2022). AI Act: Balancing transparency and confidentiality. Retrieved from https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/12527-Regulation-on-the-European-Union-Agency-for-Cybersecurity-and-the-European-Union-Digital-Identity-Electronic-Signature-and-Trust-Services-Regulation-and-the-Artificial-Intelligence-Act_en
[2] European Parliament. (2022). AI Act: Creators and rightsholders express concerns. Retrieved from https://www.europarl.europa.eu/news/en/headlines/society/20220315STO78593/ai-act-creators-and-rightsholders-express-concerns
[3] European Parliament. (2022). AI Act: Enhancing intellectual property protection. Retrieved from https://www.europarl.europa.eu/RegData/etudes/STUD/2022/668681/IPOL_STU(2022)668681_EN.pdf
[4] European Parliament. (2022). AI Act: Implementing technical measures for IP protection. Retrieved from https://www.europarl.europa.eu/RegData/etudes/STUD/2022/668681/IPOL_STU(2022)668681_EN.pdf
- The European Union's new AI Act, effective August 2, 2023, requires AI model developers to document and report data used in training their models while respecting intellectual property rights, trade secrets, and confidential business information.
- The European Parliament suggests implementing standardized dataset logs, traceability tools like watermarking or fingerprinting, and statutory remuneration mechanisms for rightsholders to address value sharing and enforce compliance, aiming to enhance intellectual property protection.
- The European Parliament's stance on the AI Act highlights the need for more effective involvement of creatives in drafting transparency templates and a complete rethink of the implementation approach to truly safeguard intellectual property rights for authors, artists, and publishers.
