The European Union's ongoing work on the EU AI Act will affect the entire AI industry and regulate AI systems based on risk classification. High-risk AI systems will be subject to a comprehensive list of requirements, while low-risk AI systems will explore the feasibility of voluntary codes of conduct. The EU AI Act is expected to become the gold standard for the AI industry, and enterprises using AI systems are advised to prepare for compliance early to avoid financial burden and penalties for non-compliance. The exact pathway for compliance will depend on the unique circumstances of each enterprise.

On October 20, 2023, the European Commission published its final version of the Delegated Regulation on conducting Independent Audits for Very large Online Platforms (VLOPs) and Search Engines (VLOSEs) under the Digital Services Act (DSA). The rules seek to provide guidance to audited providers and auditors on the audit process, reporting templates, and procedural details. Holistic AI, a leader in AI Assurance and Algorithm Auditing, offers independent annual audits and other compliance services to covered entities under the DSA. The company provides customized solutions to assist businesses in complying with the regulation and offers a Final Audit Report with operational recommendations and risk analysis.

New York City Local Law 144 requires annual independent bias audits of automated employment decision tools (AEDTs) for employers and employment agencies using them to evaluate candidates for employment or employees for promotion in NYC. The law also imposes transparency and notification requirements. AEDTs are defined as computation processes derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issue a simplified output to assist or replace discretionary decision-making. A bias audit assesses if the AEDT results in disparate impact against individuals based on race/ethnicity and/or sex/gender. Auditors must be independent and impartial, and employers/employment agencies must disclose certain data and provide notice to candidates and employees at least ten working days before using an AEDT. Penalties for non-compliance range from $500 to $1500 per violation. Holistic AI offers independent AI Bias Audits to help employers comply with the law.

The Digital Services Act (DSA) sets out a comprehensive accountability and transparency regime for digital services and platforms operating in the European Union (EU), including very large online platforms (VLOPs) and search engines (VLOSEs) with over 45 million monthly active users. A key provision of the DSA is independent auditing, which mandates VLOPs and VLOSEs to commission external auditors to test and validate their compliance efforts annually. The European Commission released a Delegated Regulation in May 2023 to provide procedural guidance on conducting these audits, which include risk assessments, opt-outs from personalized recommendations, algorithm transparency, data access for researchers, and audit reports. Holistic AI provides services to conduct these independent audits.

New York City Mayor Eric Adams and Chief Technology Officer Matthew Fraser have released an AI Action Plan for responsible AI in city government, which defines AI as an umbrella term for a range of technologies that make predictions, inferences, recommendations, rankings, or other decisions with data. The plan sets out seven key initiatives, including designing a governance framework, educating and empowering the public, and supporting AI implementation within city agencies while ensuring due diligence in procurement. The publication of the plan follows previous efforts in the city to manage the risks of AI, such as developing a framework for identifying algorithmic tools and enforcing independent bias audits of automated employment decision tools.