Executive Summary
With the Regulation on Artificial Intelligence (the "AI Act") entering into force in due course, following its publication in the Official Journal of the EU, there has been an increasing focus of supervisory bodies to provide initial guidance to regulated financial service providers who are using or intend to use Artificial Intelligence ("AI") in the provision of financial services.
The European Securities and Markets Authority ("ESMA") has issued a public statement providing initial guidance to firms using AI in the provision of investment services to retail clients and their compliance with MiFID II requirements.
Furthermore, the Central Bank of Ireland Director of Consumer Protection delivered remarks outlining the Central Bank's expectation of financial services firms when considering using AI.
On 18 June 2024, the European Commission published a targeted consultation on AI in the financial sector to inform Commission services on the concrete application and impact of AI in financial services. The input received will enable the European Commission to provide guidance to the financial sector for the implementation of the AI Act. The consultation paper is structured in three parts and includes questions on the development of AI, specific use cases in finance (including securities markets) and on the AI Act related to the financial sector. Stakeholders are invited to respond to the consultation by 13 September 2024.
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