Why the EU AI Act Matters for All Companies
The EU Artificial Intelligence Act is the first major regulatory framework for AI—and its impact will extend far beyond the tech sector...
Business Risks of Non-Compliance with the EU AI Act
Under the EU AI Act, companies face serious consequences if they fail to meet compliance obligations:
- Fines of up to €35 million or 7% of global annual turnover
- Suspension of AI systems
- Legal claims from customers or employees
- Reputational damage
- Loss of trust among partners, suppliers, and investors
Practical Compliance Strategies for Businesses
To reduce risk and ensure readiness, companies should:
- Map current AI use across operations
- Review all third-party AI systems
- Update contracts with AI clauses
- Train legal, procurement, IT
- Establish internal AI policies
AI Compliance Clauses: A Must-Have in Contracts
✅ AI Compliance Warranties
- Vendor confirms EU AI Act compliance
- Risk assessments conducted
- Prohibited practices excluded
✅ Audit and Transparency Rights
- Documentation access
- Regular audits
- Explanation of AI decisions
✅ Liability Provisions
- Vendor assumes liability for non-compliance
- Indemnification clauses
- Immediate termination rights
What Boards Should Discuss About AI Risk and Governance
Boards must take an active role in AI oversight. Key questions include...
Conclusion: Turning Compliance Into Competitive Advantage
AI can transform your business—but only if used responsibly and compliantly...
📩 Need support drafting AI-compliant contracts and safeguarding your business?
Our legal team at LKOS Law Office is here to help you navigate the EU AI Act and embed compliance into every agreement.
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