AI system
regulatoryWhat It Means
An AI system is any technology that can make decisions, predictions, or create content by learning from data, without being explicitly programmed for every specific task. This includes everything from recommendation engines and chatbots to automated hiring tools and fraud detection systems. The key is that these systems can adapt and improve their performance over time based on the information they process.
Why Chief AI Officers Care
Under the EU AI Act, every AI system your company uses or develops now falls under regulatory scope, meaning you need to catalog, assess, and potentially register them with authorities. Different AI systems carry different compliance burdens - from simple transparency requirements to extensive testing and documentation - so understanding what qualifies as an AI system determines your regulatory workload and budget. Misclassifying systems can lead to significant penalties and operational disruptions.
Real-World Example
A retail company's inventory management software that automatically adjusts stock orders based on seasonal trends, customer behavior patterns, and supplier performance would qualify as an AI system because it makes autonomous decisions using data inference rather than following pre-written rules. Even though it seems like basic business software, it meets the EU definition because it adapts its recommendations over time without explicit reprogramming.
Common Confusion
Many organizations think only advanced technologies like ChatGPT or computer vision qualify as AI systems, but the EU definition is much broader and includes many conventional business tools that use machine learning algorithms. Simple rule-based automation that follows pre-written instructions without learning or adapting typically doesn't qualify, but the line can be surprisingly thin.
Industry-Specific Applications
See how this term applies to healthcare, finance, manufacturing, government, tech, and insurance.
Healthcare: In healthcare, AI systems encompass diagnostic imaging algorithms, clinical decision support tools, predictive analytics...
Finance: In finance, AI systems are deployed across trading algorithms, credit scoring models, fraud detection platforms, and reg...
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Includes:
- 6 industry-specific applications
- Relevant regulations by sector
- Real compliance scenarios
- Implementation guidance
Technical Definitions
EU AI ActEuropean Union Artificial Intelligence Act
"A machine-based system that is designed to operate with varying levels of autonomy and that may exhibit adaptiveness after deployment, and that, for explicit or implicit objectives, infers, from the input it receives, how to generate outputs such as predictions, content, recommendations, or decisions that can influence physical or virtual environments."Article 3(1) • Effective: August 2, 2026
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