The Extraterritorial Reach of the EU AI Act and Its Implications for Pakistani AI Developers and Freelancers
Author: Izza Ijaz, Muhammad Zain Ali
Abstract
The European Union Artificial Intelligence Act (EU AI Act) has appeared as one of the first comprehensive legal framework that is using risk based approach to regulate artificial intelligence. Because of its extraterritorial reach, the Act covers companies founded in the EU as well as thirdcountry providers and deployers whose AI systems are sold in the EU or whose services are utilised there. As a result, Pakistan’s rapidly expanding AI ecosystem is anticipated to be significantly impacted by the EU AI Act. This study examines the EU AI Act’s extraterritorial application and legal obligations placed on third country AI providers and deployers by the regulatory framework. Particularly, it explores the implications of these obligations for Pakistani AI companies, startups, and Freelancers who design, develop, or provide AI-enabled services to clients within the European Union. Special focus is placed on Challenges related to compliance burden, awareness gap, and potential exclusion from EU market. Beyond its legal reach, the Act also functions as an instrument of regulatory soft power by influencing business practices and encouraging the adoption of its standards outside the European Union. This study serves as an insightful guide for policymakers, shedding light on the potential implications for Pakistani AI developers. The study concludes that the EU AI Act is likely to become a de facto compliance benchmark for Pakistani AI developers looking to enter foreign markets since Pakistan lacks a robust domestic AI regulatory framework.
Keywords
European Union Artificial Intelligence Act, Extraterritorial Jurisdiction, Pakistani AI Developers, Freelancers, Brussels Effect, Global AI Governance.
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DOI: 10.52279/jlss.08.03.269277 | 269-277 | PDF