By Siddhi Vinayak Misra

Copyright breezyscroll

Italy has made history as the first European Union nation to pass a domestic law aligning directly with the EU’s landmark AI Act, putting itself at the center of Europe’s effort to regulate artificial intelligence. The legislation, passed on September 17, 2025, under Prime Minister Giorgia Meloni’s government, is designed to balance safety, transparency, and innovation—all while boosting the country’s competitiveness in a rapidly evolving technological race.

Why did Italy pass this law now?

The move comes at a moment when European policymakers are racing to get ahead of the risks posed by generative AI tools like ChatGPT, MidJourney, and deepfake technologies. Italy, which briefly banned ChatGPT in 2023 over privacy concerns, has consistently positioned itself as a cautious yet proactive regulator of AI.

By pushing forward with a national AI law in step with the EU, Italy aims to:

Ensure human oversight of AI systems.

Protect citizens from harmful or deceptive uses of AI.

Support homegrown innovation in key industries like cybersecurity, healthcare, and telecom.

Send a signal that technology must remain “within the perimeter of the public interest,” as Alessio Butti, Italy’s undersecretary for digital transformation, explained.

What does the new law cover?

The legislation introduces cross-sector rules, applying to AI use in healthcare, employment, education, public services, justice, and sports. Its provisions are both protective and promotional—restricting harmful AI practices while funding innovation.

Here are the core elements:

1. Human oversight and accountability

AI-generated decisions must be traceable and reviewable by humans.

Doctors, judges, or employers cannot rely solely on AI—final responsibility remains with a human decision-maker.

Parents must approve AI usage for children under 14.

2. Combating harmful AI misuse

Creating or spreading harmful AI content, such as deepfakes, can lead to 1–5 years in prison.

AI tools used for crimes like fraud or identity theft face additional penalties.

3. Copyright and intellectual property

Works created with AI enjoy protection only if there is meaningful human involvement.

AI text and data mining is allowed only on non-copyrighted material or in research conducted by authorized institutions.

4. Transparency in workplaces and schools

Employers must disclose AI use to employees.

Educational institutions must inform students about when and how AI is being used.

5. AI in healthcare

AI may assist in diagnosis and treatment but cannot replace doctors.

Patients must be told if AI is used in their care.

Who will enforce the law?

Agency for Digital Italy (AgID) and the National Cybersecurity Agency will serve as the main AI regulators.

Traditional watchdogs like the Bank of Italy and Consob (Italy’s financial regulator) will retain their supervisory powers in their respective domains.

This multi-agency approach ensures oversight across industries while embedding AI into existing governance structures.

How will Italy fund AI innovation?

Alongside regulation, the government has committed up to €1 billion ($1.18 billion) from a state-backed fund to support firms in AI, cybersecurity, telecoms, and quantum technology.

This signals Italy’s dual ambition: to guard against AI’s risks while ensuring domestic companies can compete in the global race.

Why does this matter for Europe?

Italy’s law is significant because:

It sets a precedent for other EU nations preparing to implement the EU AI Act.

It highlights the balance of innovation and regulation—too little oversight risks public harm, while too much may stifle economic opportunity.

It demonstrates a “middle path” approach: encouraging AI adoption in critical sectors but demanding safeguards and accountability.

Other EU states, including France and Germany, are closely watching Italy’s rollout to evaluate whether its model can be replicated.

The bigger picture: AI governance worldwide

Globally, AI regulation is unfolding unevenly:

United States: Still debating a federal AI framework; regulation is fragmented across states.

China: Imposes strict controls on generative AI output, requiring alignment with “core socialist values.”

UK: Adopts a “pro-innovation” approach with sector-specific regulators rather than a sweeping AI law.

Italy’s law—firm but innovation-friendly—may offer Europe a template for balancing values with competitiveness.

Italy has passed Europe’s first national AI law aligned with the EU AI Act. It requires human oversight of AI, criminalizes harmful uses like deepfakes, enforces transparency in workplaces, protects children, and sets copyright boundaries. The law also earmarks €1 billion for AI and cybersecurity firms. Seen as both protective and growth-oriented, Italy’s model could shape how the EU and beyond regulate AI in the coming years.