21.4 AI Regulations

AI regulations are laws and official frameworks that set rules for how AI systems may be built and used. They aim to protect people's rights and safety while still allowing innovation. Well-known examples include the EU's GDPR (data protection) and the EU AI Act, which classifies AI systems by risk level.

Regulations balance protecting people's rights and safety against allowing room for innovation.

For example, an Ethiopian fintech startup that wants European customers must comply with GDPR — meaning users can ask what data is held about them and request deletion. Even locally, Ethiopia's data-protection rules increasingly require companies to safeguard personal information and be transparent about automated decisions.

Scenario

Your company is launching an AI tool that automatically screens job applicants in the EU. Under the EU AI Act, how should you treat it?

Check your understanding

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What approach does the EU AI Act primarily use to regulate AI?