The European Union’s (EU) recent decision to release an updated code of practice to help companies better understand the AI Act’s transparency requirements demonstrates the pitfalls that organizations face when trying to comply with rules that many expect to be strictly enforced.

Experts largely welcome the latest guidance and advise companies to ensure their AI use is aligned to it—even though the code of practice is neither finalized nor mandatory. They also believe that it will help compliance functions specifically to provide a clearer steer for their organizations as to what constitutes safe AI use under the legislation and to help inform users as to whether content is AI-generated.

Neil Hodge is a freelance business journalist and photographer based in Nottingham, United Kingdom. He writes on insurance and risk management, corporate governance, internal audit, compliance, and legal...