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EU AI Act - SME and Startup-Specific Provisions: Reduced Fees, Sandbox Priority, and Proportionate Compliance

EU AI Act (Regulation 2024/1689) includes multiple provisions specifically designed to reduce the compliance burden on small and medium-sized enterprises…

What EU AI Act - SME and Startup-Specific Provisions: Reduced Fees, Sandbox Priority, and Proportionate Compliance requires

EU AI Act (Regulation 2024/1689) includes multiple provisions specifically designed to reduce the compliance burden on small and medium-sized enterprises (SMEs, as defined in Commission Recommendation 2003/361/EC - fewer than 250 employees and annual turnover ≤€50M or balance sheet ≤€43M) and startups, recognising that disproportionate compliance costs could stifle EU AI innovation and favour large incumbents: Article 57(3) requires Member States to give SMEs and startups priority access to regulatory sandboxes; Article 73(3) limits administrative fines for SMEs to lower maximums than those applicable to large enterprises (maximum €15M or 3% of global annual turnover for most violations by SMEs, versus €35M or 7% for violations involving prohibited practices); Article 55(3) requires the Commission to consider the specific interests of SMEs when adopting delegated acts; Recital 91 acknowledges the potential disproportionate impact of EU AI Act obligations on SMEs and instructs authorities to take proportionate enforcement approaches; Article 60(7) reduces fees charged by national competent authorities for EU AI database registration for SMEs; Article 72 provides that Member States shall ensure that regulatory sandboxes are accessible to SMEs without undue financial or administrative barriers; the EU AI Office must publish guidance specifically addressing SME compliance with the EU AI Act's requirements.

Pillar: AI Governance & Law · Authority: European Parliament and Council of the EU · Version: 1.0.0 · Last updated:

Primary source: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32024R1689

SHA-256 integrity: 48928a85e06ea3948b30017143bde6801fe33eb5f502ea85ca4ba94b1ec294ef

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