EU AI Act Timeline: What It Means for Ecommerce Businesses

The EU AI Act is set to redefine how artificial intelligence (AI) is used in European ecommerce. This legislation, which aims to ensure AI is human-centric and trustworthy, isn't just another regulatory hurdle – it's a major shift that will shape how businesses interact with customers, manage data, and innovate.

"The AI Act has nudged the future of AI in a human-centric direction, in a direction where humans are in control of the technology and where it, the technology, helps us leverage new discoveries, economic growth, societal progress and unlock human potential," said Dragoș Tudorache, Member of the European Parliament (MEP) and AI Act co-rapporteur.

But what does this mean for your ecommerce business? How will it affect your AI-driven tools and strategies?

In this article, we’ll explore the EU AI Act’s key provisions, its impact on ecommerce, and how businesses can prepare for compliance. We’ll also examine how industry giants like Amazon are adapting to this new AI landscape.

Whether you’re a small online shop or a major ecommerce player, the EU AI Act will influence your business.

EU AI Act Risk Categories

The EU AI Act introduces a risk-based approach to AI regulation, categorising AI systems based on their potential impact.

For ecommerce businesses, understanding these categories is crucial for compliance and strategic planning.

EU AI Act Timeline for Implementation

The EU AI Act was officially adopted by the European Parliament on 13 March 2024. However, the regulation won't come into force immediately. Here's the timeline for implementation:

• The EU AI Act was published in the Official Journal of the European Union on 12 July 2024
• It entered into force on 1 August 2024
• There will be a gradual implementation period, with different provisions becoming applicable at different times.
• Full compliance with most provisions will be required by approximately mid-2026

The timeframe for businesses to comply with the AI Act will vary based on their role and the risk level of their AI systems.

Key Dates for Businesses

EU AI Act Penalty

The maximum penalty for non-compliance with the EU AI Act's rules on prohibited uses of AI is the higher of an administrative fine of up to €35 million or 7% of worldwide annual turnover.

How the EU AI Act Will Reshape Ecommerce

According to a European Commission study, 42% of European businesses already use at least one AI technology. Ecommerce leads this adoption, making the sector particularly vulnerable to regulatory changes.

Here’s how the EU AI Act might impact various aspects of ecommerce.

Personalisation and Recommendations

Ecommerce platforms like Amazon may need to reassess their AI-driven recommendation engines to ensure they don’t use manipulative techniques to influence purchasing decisions or exploit vulnerable populations, such as minors, the elderly, or individuals with limited financial literacy.

For example, Amazon’s enhanced AI-driven personalization system, which tailors product titles and descriptions based on customer preferences and search behaviours, could be subject to the AI Act’s guidelines on respecting user privacy and preventing manipulation.

Amazon will need to be careful that its personalised recommendations do not cross ethical lines, especially when targeting minors or economically disadvantaged users.

Simply put, businesses must balance personalization with privacy and fairness.

AI-Generated Content Disclosure

Transparency is a key aspect of the AI Act, and businesses using AI for customer interaction will need to clearly label AI-generated content and notify users when they’re interacting with an AI system. This affects sellers using chatbots, recommendation engines, or product descriptions generated by AI. 

Compliance with EU copyright laws for data used in AI training will become essential, requiring platforms like Amazon to disclose how their AI-generated content is created.

Overall, ensuring that customers know when they’re dealing with AI can enhance trust but will also require operational adjustments.

Analytics

Amazon recently announced they’ll be launching new Customer Journey Analytics tools for sellers by early 2025. These tools offer advanced segmentation and tailored promotions, which means, if launched in Europe, Amazon will need to ensure that they comply with the AI Act’s provisions around data protection and user consent.

Analytics tools process significant customer data, and under the Act, Amazon will have to be transparent about how each collects, processes, and uses this data. Sellers relying on these tools will need to be mindful of how the AI’s audience segmentation might impact user rights and privacy.

Pricing Algorithms

AI-driven dynamic pricing will face scrutiny to prevent discrimination or dynamic pricing based on vulnerability. For instance, some AI-driven ecommerce platforms could apply personalised pricing, adjusting product costs based on the perceived willingness or desperation of a consumer to pay. Vulnerable populations could face higher prices for essential goods or services because the algorithms identify them as more likely to complete a purchase, regardless of the price.

Fraud Detection

AI systems for fraud prevention must be designed to avoid bias. This could affect risk management strategies.

Supply Chain Management

AI systems used in inventory and logistics may require documentation on how they were built, what data was used, and the potential risks involved.

Amazon Drone Delivery and Automation

The AI Act’s restrictions on real-time biometric recognition and the use of AI for monitoring public spaces could affect Amazon’s expansion of its drone delivery services.

While drones are a key part of Amazon’s strategy to deliver within an hour, the use of AI for real-time decision-making, navigation, and customer verification would need to align with EU safety regulations. The introduction of the new MK30 drone in Italy and the UK could face additional scrutiny, requiring compliance with cybersecurity and human rights standards to ensure safe and responsible usage.

The EU AI Act will push Amazon to make its AI-powered logistics more transparent, human-supervised, and compliant with strict regulations, particularly as it scales its delivery services and integrates new AI technologies into its supply chain across Europe.

Case Study: Amazon’s AI-Powered Shopping Assistant

Amazon’s recent launch of Rufus, an AI shopping assistant across Europe, exemplifies the rapid advancement of AI in ecommerce. Trained on Amazon's vast product catalogue and web information, Rufus aims to revolutionise the shopping experience.

An Amazon spokesperson emphasised, “We believe generative AI is going to change virtually all customer experiences that we know."

However, this innovation also raises questions about compliance with the EU AI Act. How will Amazon ensure transparency? How will they manage potential biases in Rufus's recommendations?

Amazon expert, Vanessa Hung, says: "AI world domination! This update confirms my prediction that Amazon will roll out AI tools across all marketplaces by next year. I think adoption will happen way faster than we can imagine, and most sellers are not prepared to sell to AI."

Vanessa’s statement underscores the urgency for all ecommerce businesses, regardless of size, to prepare for an AI-driven marketplace.

Preparing for Compliance: Action Steps

To prepare for the EU AI Act, ecommerce businesses should:

• Conduct an AI Audit: Identify all AI systems in use across your business operations.
• Risk Assessment: Categorise your AI systems according to the Act’s risk levels.
• Documentation: Implement robust documentation processes for AI systems, especially for high-risk categories.
• Transparency Measures: Develop clear communication strategies for disclosing AI use to customers.
• Ethical AI Framework: Establish guidelines for ethical AI development and use within your organisation.
• Staff Training: Invest in AI literacy and ethics training for your team.
• Compliance Monitoring: Set up ongoing monitoring systems to ensure continued compliance as your AI systems evolve. 
• ​​Regulatory Sandbox Participation: Consider participating in national regulatory sandboxes (available from August 2026) to test AI innovations in a controlled environment