South Korea Adopts Landmark Regulatory Framework for Artificial Intelligence

South Korea has adopted what it presents as the world’s first comprehensive legal framework dedicated specifically to the regulation of artificial intelligence, through its new AI Basic Act. The legislation will enter into force earlier than the EU AI Act — whose implementation will be phased in until 2027 — and aims to strengthen trust and safety while supporting the country’s ambition to become a global AI leader.

The law introduces mandatory human oversight for so-called “high-impact” AI systems, particularly in sectors such as healthcare, nuclear safety, transportation, drinking water production, and financial services (including credit scoring and loan approvals).

Companies deploying generative AI or high-impact AI systems will also be required to inform users in advance and clearly label AI-generated content when it may be difficult to distinguish from reality.

Although a transition period of at least one year is предусмотрed before administrative sanctions are applied, startups have raised concerns about the perceived vagueness of certain provisions, warning that compliance burdens could slow innovation. South Korean authorities have indicated that support mechanisms and detailed guidelines will be introduced to mitigate compliance costs.

Penalties under the Act can reach up to 30 million won (approximately $20,400), particularly for failures related to generative AI labeling obligations — a significantly lower level than fines under the EU AI Act, which may reach up to 7% of global annual turnover.

Source

Reuters – South Korea launches landmark laws to regulate AI; startups warn of compliance burdens