In Part 2 of my blog series related to the preparation for the application of the AI Act, I deal with the scope of the AI Act, i.e. I examine in more detail the personal, territorial and material scope of application of the regulation. The exceptions to the scope of the regulation will also be discussed below. The question of personal, territorial and material scope is contained in Article 2 of the AI Act, so I will start from the interpretation of this Article.
1. Who is covered by the AI Act and with what territorial scope?
As I discussed in Part 1 of these series, the scope of the AI Act covers the following operators:
- provider
- deployer
- importer
- distributor
- product manufacturer
- authorised representative of non-EU providers.
In order to decide whether the AI Act should apply to the specific activities of these operators, the provisions on territorial scope should also be taken into account. With regard to the territorial scope, it is worth pointing out that a solution familiar from the GDPR will also appear in the AI Act, according to which even entities established outside the EU will have to apply the requirements of the regulation if their activities also extend to the EU (e.g. AI systems are placed on the market or put into service in the EU, or outputs produced by an AI system are used in the EU).
This extraterritorial scope should ensure that providers or deployers of AI systems placed on the market or put into service in the EU or having an impact on persons located in the EU cannot avoid the application of EU law by choosing their place of establishment. This is also referred to in the recitals to the AI Act, which stresses the need to apply the regulation to providers of AI-systems in a non-discriminatory manner, irrespective of whether they are established within the Union or in a third country, and to deployers of AI systems established within the Union, in order to ensure a level playing field and an effective protection of rights and freedoms of individuals across the Union (see Recital (21)).