The EU Just Dropped the Hammer on AI—Here’s What Aussie Businesses Need to Know
AI is evolving faster than you can say "machine learning algorithm," and governments are scrambling to catch up. The European Union’s AI Act is officially the world’s first comprehensive legal framework for artificial intelligence. And while most of it won’t take effect until 2026, two big rules kicked in on 2 February 2025—and they’re a big deal for businesses in and outside of Europe.
So what’s changing? And more importantly, does this affect Aussie businesses? (Spoiler: If you do business in the EU, yeah, it does.)
The Two AI Rules That Just Kicked In
🛑 Article 4: AI Literacy (a.k.a. "Know What You’re Using")
Companies that make, use, or sell AI now have to train their employees on the risks and impact of AI. Basically, if your team is working with AI in any way, shape, or form, they need to understand what it can and can’t do.
What this means for businesses:
If you’re selling AI-powered tools, you need to educate your customers too (not just your internal team).
Expect AI training and compliance programs to become a thing (yes, another compliance headache).
This applies to any company operating in the EU—even if you’re based elsewhere (looking at you, Australia).
🚫 Article 5: AI Practices That Are Now Completely Banned
Some AI applications have officially been scrapped, and businesses caught using them could be fined up to €35 million or 7% of global revenue (whichever is higher) by August 2025.
Here’s what’s now illegal under Article 5:
❌ AI that manipulates or deceives people
❌ AI that exploits vulnerabilities (like age or economic insecurity)
❌ AI that ranks people based on behaviour (social scoring)
❌ AI that scrapes images or faces from the internet without permission
❌ AI that predicts criminal behaviour based on profiling
❌ AI that analyses emotions in workplaces or schools
❌ AI that conducts real-time biometric surveillance in public places
There are some exceptions (e.g., if it’s needed for security reasons or a kidnapping case), but for the most part, these AI applications are a big no-go.
What Does This Mean for Aussie Businesses?
If your business sells AI-powered tools, provides services in the EU, or even just partners with European companies—you need to pay attention.
🔹 Got an AI product? You’ll need to train staff and customers on ethical AI use (thanks, Article 4).
🔹 Using AI for customer analysis? Make sure it’s not doing anything remotely shady like manipulating behaviour, scoring customers based on actions, or scraping data without consent.
🔹 Marketing or hiring tools powered by AI? Be extra careful about how they process data—especially if they’re making decisions based on personal traits.
What Should You Do Next?
✔️ Check Your AI Systems – Make sure nothing you’re using or selling is on the banned list.
✔️ Get Educated on AI Compliance – If you’re in AI, you need to start training your team (and possibly customers) ASAP.
✔️ Stay Updated – The EU’s AI laws are setting the standard worldwide, and similar regulations might pop up in Australia soon.
The EU AI Act Is a Wake-Up Call
This is just the beginning of AI regulations. Europe is leading the charge, but it’s only a matter of time before Australia follows suit. If you’re in AI, marketing, recruitment, or even just using AI in your daily work, start getting your compliance ducks in a row now—or risk scrambling later.
Want to read the full law? Check it out here: eur-lex.europa.eu
Because "I didn’t know" won’t fly when the fines hit. 🚨
