Spain’s Council of Ministers has approved a draft law that could impose fines of up to €35 million on companies working with artificial intelligence (AI) for incorrect content labeling.
The bill classifies the mislabeling of AI-generated content as a serious offense, with penalties ranging from €7.5 million to €35 million or between 2% and 7% of a company’s global turnover. Startups and medium-sized businesses may face less severe penalties.
The draft law is based on the provisions of the EU AI Act, which imposes strict transparency requirements on high-risk AI systems. However, before coming into effect, the bill must be approved by Spain’s Congress of Deputies.
In addition to content labeling requirements, the bill prohibits the use of hidden manipulative techniques, such as imperceptible images or sounds that influence people’s decisions without their awareness.
Companies will also be banned from using AI to classify individuals based on race, political views, religion, or sexual orientation using biometric data or social media activity.
Additionally, the law introduces fines ranging from €500,000 to €7.5 million (or 1% to 2% of annual turnover) for AI companies that use biometrics to monitor employee attendance without human oversight.
