Over the last few years, artificial intelligence (AI) has surged to the forefront of organizational agendas worldwide, captivating minds and budgets alike with promises of efficiency, insight and transformation. Yet, as with any disruptive technology, legislation has lagged.  

Enter: The European Union (EU), steadfast in shaping the ethical and legal framework surrounding AI. Since the inception of the EU AI Act proposal in April 2021, this ambitious legislation has undergone numerous revisions and amendments. 

On March 13th, 2024, the legislation was passed by the European parliament — which means it’s time for businesses to navigate the complex terrain of managing their data governance and data ingestion practices under this new legislation. 

What is the EU AI Act? 

The EU AI Act is a comprehensive piece of legislation by the European Commission aimed at regulating AI systems within the European Union. It seeks to establish a harmonized framework for the development, deployment and use of AI technologies across various industry verticals while ensuring compliance with fundamental rights and values.

Key components of the EU AI Act include:

• Scope: The regulation applies to AI systems placed in the EU market or used within the EU, with certain exceptions for military and national security purposes.

• Risk assessment: It categorizes AI systems based on their risk level, distinguishing between prohibited AI practices (such as social scoring systems), high-risk AI systems (like those used in critical infrastructure, law enforcement or healthcare) and lower-risk AI systems.

• Requirements for high-risk AI: High-risk AI systems must adhere to strict requirements, including data quality, transparency, documentation, human oversight and robustness. They may also need to undergo conformity assessments.

• Prohibition of certain practices: It prohibits certain AI practices that are considered particularly harmful or intrusive, such as AI-enabled social scoring systems that violate human dignity.

• Supervision and enforcement: It establishes oversight mechanisms and enforcement measures to ensure compliance with the regulation, including penalties for non-compliance.

• European Artificial Intelligence Board: A new regulatory body, the European Artificial Intelligence Board, will oversee the implementation and enforcement of the EU AI Act.

The EU AI Act represents a significant step towards creating a regulatory framework that balances innovation with ethical and societal considerations in the development of AI technologies within the EU.

“As the EU AI Act passes, significant shifts are underway in how companies manage data within the European Union. With heightened legal obligations surrounding governance and security, companies are carefully assessing tools and platforms within their data infrastructure to ensure they meet the necessary standards and guidelines.”
- Manas Nayak, AVP Data & Analytics (UK & Europe), LTIMindtree

What does the EU AI Act mean for your data?

The EU AI Act is likely to have several implications for companies' data governance and data movement practices. 

Here's how it could affect them:

• Data quality and transparency: Companies will need to ensure that the data they ingest and move meets the quality standards outlined in the EU AI Act. This includes transparency about data soources, how it's processed and any potential biases or limitations.

• Privacy and data protection: The act emphasizes the importance of privacy and data protection, requiring companies to adhere to strict guidelines to safeguard personal data. This could mean that companies will need to implement additional measures to ensure compliance with EU data protection regulations such as the General Data Protection Regulation (GDPR).

• Data governance frameworks: Companies may need to develop or enhance their data governance frameworks to align with the requirements of the EU AI Act. This includes establishing processes for data management, documentation and accountability throughout the data lifecycle.

• Impact on data movement: The Act may impose restrictions or requirements on the movement of data, especially when it involves transferring data outside the EU. Companies may need to ensure that data transfers comply with EU data transfer mechanisms, such as Standard Contractual Clauses (SCCs) or Binding Corporate Rules (BCRs), to ensure data protection standards are maintained.

• Risk assessment and compliance: Companies will need to conduct risk assessments for the AI systems they develop or deploy, including those that involve data movement or ingestion. This entails evaluating the potential risks to individuals' rights and freedoms and taking appropriate measures to mitigate them.

• Oversight and accountability: The Act establishes oversight mechanisms and enforcement measures to ensure compliance with its provisions. Companies will need to demonstrate accountability for their data governance and data movement practices, including cooperation with regulatory authorities and compliance with audits and assessments.

How Fivetran helps organization align with the EU AI Act

Meeting the needs of the EU AI Act requires scalable control solutions, top-tier security and complete visibility into the entire data movement process. 

“It's crucial for businesses leveraging AI to determine their risk level and take appropriate action to comply with the EU AI Act.”
- Manas Nayak, AVP Data & Analytics (UK & Europe), LTIMindtree

Fivetran is the leading data integration platform that enables streamlined data governance and mitigates the risk of data breaches, while still fostering collaboration across stakeholders. Our platform provides the automation and control necessary to maintain complete data compliance. 

We provide comprehensive security and data governance features including:

• Deployment models for every architecture: Whether on-prem, the cloud or hybrid, deploy Fivetran in the way that makes the most sense for your business. We’re also consistently adding to an extensive library of cloud regions that power data processing to meet data residency requirements for businesses across the globe.
  
  
• Robust metadata sharing: Fivetran Metadata provides enhanced visibility into where data came from, who accessed it and what changes have occurred in the pipeline — including complete, source to destination data lineage. The Fivetran Platform Connector can integrate with your homegrown solution or with any of the industry-leading catalogs.
  
  
• Granular and automated access control: Our role-based access controls (RBAC) restrict access to internal company resources and managing permissions within each resource area. Users only have access to the minimal permissions needed to do their job and prevents users from accessing resources that don't pertain to them.
  
  
• Block or hash sensitive data: With the Fivetran column blocking and hashing feature, you can automatically block or hash specific columns from replicating to your destination.
  
  
• Proven security and compliance: Fivetran meets all major security and compliance certifications and requirements including CCPA, GDPR, HIPAA, HITRUST, ISO, PCI, SOC 1 and SOC 2.

• Advanced data residency: Fivetran offers the flexibility to configure your data processing to stay within the geographical region of your choosing, meaning data configured to stay in the EU, for example, will not leave the EU at any point during processing. 

With these features and more, Fivetran powers your AI innovation with automated access to centralized, cleansed and governed data. This enables organizations of every size to meet the needs of this new legislation, while still maintaining control without constraint. 

“Companies are prioritizing data integrity, AI safety, observability and regulatory compliance. This concerted effort reflects a fundamental shift towards ensuring smooth and secure operations in today's technologically driven landscape.
- Manas Nayak, AVP Data & Analytics (UK & Europe), LTIMindtree

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