From 2 February 2025, the AI Act will prohibit manipulation by AI, social scoring and remote biometric identification in real time – a decisive step for ethics and consumer protection. The EU is thus sending a clear signal in favour of a uniform legal framework based on ethics, diversity and data security. However, the AI Act must become more practical if the innovation potential of AI is to be fully exploited for Germany and Europe as business locations, emphasises Alexander Rabe, Managing Director of eco – Association of the Internet Industry.
“Unclear regulations and inconsistent national implementation create legal uncertainty and hinder innovation, especially for SMEs, which often do not have the human or financial resources to adapt to complex and inconsistent regulations,” says Rabe. This could lead companies to postpone or abandon necessary investments in AI technologies. “These uncertainties must be quickly resolved so that Germany does not lose touch with the less regulated major powers China and the USA, which are expanding their leading role in AI investments with flexible and market-oriented approaches. Hesitant action increases the risk of valuable innovation potential migrating abroad – and weakening Europe as a business location in the long term,” Rabe continues.
AI is key to offsetting productivity losses and promoting growth: according to a recent study by the Cologne Institute for Economic Research (IW), AI could contribute up to 330 billion Euro annually to German economic output. A clear, EU-wide legal framework is therefore essential to strengthen Europe as a business location and to avoid falling behind the United States. There, flexible, market-oriented regulations promote investment, while Europe is in danger of stifling innovative potential through bureaucracy.
“What is needed now is rapid standardisation, clear definitions and close coordination between the AI Act and existing regulations to avoid duplication and uncertainty. Only in this way can Europe realise its ambitions as a leading AI location,” says Alexander Rabe.
