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Europe sets benchmark for rest of the world with landmark AI laws

Europe sets benchmark for rest of the world with landmark AI laws

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Europe sets benchmark for rest of the world with landmark AI laws

 Europe’s landmark rules on artificial intelligence will enter into force next month after EU countries endorsed on Tuesday a political deal reached in December, setting a potential global benchmark for a technology used in business and everyday life.

The European Union’s AI Act is more comprehensive than the United States’ light-touch voluntary compliance approach while China’s approach aims to maintain social stability and state control. 

The vote by EU countries came two months after EU lawmakers backed the AI legislation drafted by the European Commission in 2021 after making a number of key changes.

Concerns about AI contributing to misinformation, fake news and copyrighted material have intensified globally in recent months amid the growing popularity of generative AI systems such as Microsoft-backed OpenAI’s ChatGPT, and Google’s chatbot Gemini.

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“This landmark law, the first of its kind in the world, addresses a global technological challenge that also creates opportunities for our societies and economies,” Belgian digitisation minister Mathieu Michel said in a statement.

“With the AI Act, Europe emphasizes the importance of trust, transparency and accountability when dealing with new technologies while at the same time ensuring this fast-changing technology can flourish and boost European innovation,” he said.

The AI Act imposes strict transparency obligations on high-risk AI systems while such requirements for general-purpose AI models will be lighter.

It restricts governments’ use of real-time biometric surveillance in public spaces to cases of certain crimes, prevention of terrorist attacks and searches for people suspected of the most serious crimes.

The new legislation will have an impact beyond the 27-country bloc, said Patrick van Eecke at law firm Cooley.

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“The Act will have global reach. Companies outside the EU who use EU customer data in their AI platforms will need to comply. Other countries and regions are likely to use the AI Act as a blueprint, just as they did with the GDPR,” he said, referring to EU privacy rules.

While the new legislation will apply in 2026, bans on the use of artificial intelligence in social scoring, predictive policing and untargeted scraping of facial images from the internet or CCTV footage will kick in in six months once the new regulation enters into force.

Obligations for general purpose AI models will apply after 12 months and rules for AI systems embedded into regulated products in 36 months.

Fines for violations range from 7.5 million euros ($8.2 million) or 1.5% of turnover to 35 million euros or 7% of global turnover depending on the type of violations.

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ByteDance confirms layoff plan at its Indonesian unit

ByteDance confirms layoff plan at its Indonesian unit

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ByteDance confirms layoff plan at its Indonesian unit

China’s ByteDance will lay off staff at its Indonesian unit following a deal where it bought a local e-commerce firm and combined it with its TikTok operation, a spokesperson said on Friday.

ByteDance, the owner of TikTok, did not say how many employees would be affected. Bloomberg had earlier reported there would be 450 jobs cut.

In January ByteDance completed a deal to buy a majority stake in Tokopedia, an Indonesian e-commerce firm, from the GoTo group.

ByteDance spokesperson Nuraini Razak told Reuters in a statement the company would “make necessary adjustments” as a result of the combination of TikTok and Tokopedia.

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“We identified areas to strengthen our organisation and better align our teams with company goals,” she said, adding the company would “aim to support employees throughout this transition”.

ByteDance had its own e-commerce operation in Indonesia via its TikTok app, but that was banned under an Indonesian rule that social media applications could not operate as an e-commerce platform.

Tokopedia is one of the leading e-commerce platforms in Southeast Asia’s largest economy.

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Indonesia minister threatens to shut down X over adult content

Indonesia minister threatens to shut down X over adult content

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Indonesia minister threatens to shut down X over adult content

Indonesia is prepared to shut down social media platform X if it does not comply with a regulation barring adult content, the country’s communications minister said on Friday. Indonesia, the world’s biggest Muslim-majority country, has strict rules that ban the sharing online of content deemed obscene.

Minister Budi Arie Setiadi told Reuters he had sent a warning letter to X related to this matter.

“We will certainly shut its services down,” he said, pointing to Indonesia’s electronic information and transaction (ITE) law that can carry a six-year jail sentence if someone spreads pornographic content.

His comments in an interview come after the social media platform recently updated its policies to permit consensually produced adult content.

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X, owned by billionaire Elon Musk, has not responded to Indonesia’s warning letter, Budi said, adding the government would send more letters before deciding on a potential closure.

X, formerly known as Twitter, did not immediately respond to a request by Reuters for comment.

Indonesians are big users of social media and X has 24.85 million users in the country, according to data gathering business Statista.

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Japan watchdog recommends action on MUFG units over sharing of client data

Japan watchdog recommends action on MUFG units over sharing of client data

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Japan's securities watchdog recommended on Friday that the banking and securities units of Mitsubishi UFJ Financial Group opens new tab (MUFG) be penalised for what it said was unauthorised sharing of client information. The Securities and Exchange Surveillance Commission (SESC) made the recommendation to the banking regulator, the Financial Services Agency (FSA), which hands out such punishments in Japan. The recommendation, which was widely expected, followed the SESC's investigation into MUFG's banking arm, MUFG Bank, and its two brokerage ventures with Morgan Stanley (MS.N), opens new tab. The investigation found that confidential client information had been shared between MUFG Bank and one of the two securities firms on at least 26 occasions between 2020 and 2023. MUFG Bank also illegally offered preferential lending rates to clients that did business with the group's two securities brokerages, the SESC said. Japan's "firewall" regulations prohibit banks and securities companies in the same group from sharing customer data with one another without the customer's consent. The investigation found no evidence of insider trading, but monitoring and internal controls were lacking, the SESC said. MUFG group companies will make every effort to strengthen control systems in light of the recommendation and will take measures to prevent recurrence, the parent company said in a statement. The two brokerages were established in 2010, two years after MUFG invested in Morgan Stanley at the height of the global financial crisis in 2008. MUFG owned around 23% of Morgan Stanley as of March 2024.

Japan’s securities watchdog recommended on Friday that the banking and securities units of Mitsubishi UFJ Financial Group  opens new tab (MUFG) be penalised for what it said was unauthorised sharing of client information.

The Securities and Exchange Surveillance Commission (SESC) made the recommendation to the banking regulator, the Financial Services Agency (FSA), which hands out such punishments in Japan.

The recommendation, which was widely expected, followed the SESC’s investigation into MUFG’s banking arm, MUFG Bank, and its two brokerage ventures with Morgan Stanley (MS.N), opens new tab.

The investigation found that confidential client information had been shared between MUFG Bank and one of the two securities firms on at least 26 occasions between 2020 and 2023.

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MUFG Bank also illegally offered preferential lending rates to clients that did business with the group’s two securities brokerages, the SESC said.

Japan’s “firewall” regulations prohibit banks and securities companies in the same group from sharing customer data with one another without the customer’s consent.

The investigation found no evidence of insider trading, but monitoring and internal controls were lacking, the SESC said.

MUFG group companies will make every effort to strengthen control systems in light of the recommendation and will take measures to prevent recurrence, the parent company said in a statement.

The two brokerages were established in 2010, two years after MUFG invested in Morgan Stanley at the height of the global financial crisis in 2008. MUFG owned around 23% of Morgan Stanley as of March 2024.

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