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Roger Clarke's 'Evaluation of EC's AI Regulation'

Would the European Commission's Proposed Artificial Intelligence Act
Deliver the Necessary Protections?

Annex 5: The Scope of Applicability of the EC's Proposal

It is an Annex to the article of the above name

Version of 31 August 2021

Roger Clarke **

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This document is at http://www.rogerclarke.com/DV/EC21-Ann5.html


This Annex extracts key passages in the EC Proposal that determine the scope of the regulatory regime.

Summary

For the proposed law to apply:

INCLUSIONS
1. Artefact - What things are within-scope?

"AI Systems", viz. "software that is developed with one or more [specified] techniques and approaches ... AND can, for a given set of human-defined objectives, generate outputs such as content, predictions, recommendations, or decisions influencing the environments they interact with" - Art. 3(1)

The specified "techniques and approaches" are Machine learning approaches ..., Logic- and knowledge-based approaches ... and Statistical approaches, Bayesian estimation, search and optimization methods - Annex I

EXCEPT "high-risk AI systems that are safety components of products or systems, or which are themselves products or systems, falling within the scope of [eight] acts" - Art. 2.2

A feasible interpretation is that this encompasses all forms in which 'software' presents, including:

However, the courts may decide otherwise.

2. Entity - Who is within-scope?
2.1 Providers

"providers placing on the market or putting into service AI systems ..." - Art. 2.1(a)

Provider "means a natural or legal person, public authority, agency or other body that develops an AI system or that has an AI system developed with a view to placing it on the market or putting it into service under its own name or trademark, whether for payment or free of charge" - Art. 3(1), second occurrence - [sic: should be 3(2)].

Combining the definition with the scope declaration, a provider is an entity that satisifies all of these conditions:

EXCEPT "public authorities in a third country" and "international organisations" that have relevant agreements with the EU or part thereof - Art. 2.4

EXCEPT 'placing on the market' means "the first making available of an AI system on the Union market" - Art. 3(9)

cf. 'making available on the market' means "any supply of an AI system for distribution or use on the Union market in the course of a commercial activity, whether in return for payment or free of charge" - Art. 3(10)

The use in the definition in 2.1(a) and 3(2) of 'placing' rather than 'making available' creates the possibility of subsequent offerors of any particular AI system, e.g. purchasers of licences and agencies, not being within-scope of the Regulation.

EXCEPT 'putting into service' means "the supply of an AI system for first use directly to the user or for own use on the Union market for its intended purpose" - Art. 3(11)

The use in the definition in 2.1(a) and 3(2) of 'putting into service', and in 3(11) of 'first' together appear to exclude from the scope the subsequent supply of previously-supplied AI systems.

2.2 Users

"users of AI systems" - Art. 2.1(b)

User means "any natural or legal person, public authority, agency or other body using an AI system under its authority ..." - Art. 3(4)

EXCEPT "where the AI system is used in the course of a personal non-professional activity" - Art. 3(4)

3. Geographical Location - Where is within-scope?
3.1 Providers

"providers [offering or deploying] AI systems irrespective of whether those providers are established within the Union or in a third country" - Art. 2.1(a)

"providers ... of AI systems that are located in a third country, where the output produced by the system is used in the Union" - Art. 2.1(c)

Clarification is needed as to whether that which has to be located within the EU to be within-scope is the provider, the system, or both. The 2.1(c) formulation might apply only to the system.

The 2.1(a) formulation might apply only to the provider's action.

A feasible interpretation is that the geographical scope-condition is satisfied if any of the provider, the provider's action or the system is within the EU; but the courts may decide otherwise.

3.2 Users

"users of AI systems located within the Union" - Art. 2.1(b)

"users ... in a third country, where the output produced by the system is used in the Union" - Art. 2.1(c)

Clarification is needed as to whether that which has to be located within the EU to be within-scope is the user, the system, the use, or two or more of them.

A feasible interpretation is that the geographical scope-condition is satisfied if any of the user, the system or the use of the output is within the EU; but the courts may decide otherwise.

4. Timeframe - When is within-scope?

No provision is apparent in the EC Proposal relating to the date when the law would come into force.

Nor is there any apparent provision for a period of applicability or a sunset clause.

EXCLUSION
5. Purpose - What uses are out-of-scope?

"... developed or used exclusively for military purposes" - Art. 2.3

`intended purpose' means "the use for which an AI system is intended by the provider, including the specific context and conditions of use, as specified in the information supplied by the provider in the instructions for use, promotional or sales materials and statements, as well as in the technical documentation" - Art. 3(12)


Author Affiliations

Roger Clarke is Principal of Xamax Consultancy Pty Ltd, Canberra. He is also a Visiting Professor in Cyberspace Law & Policy at the University of N.S.W., and a Visiting Professor in the Research School of Computer Science at the Australian National University.



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