AI-generated ads should be exempt from EU transparency rules, retailers demand

The retail industry, led by the European association Eurocommerce, has officially requested that the European Commission exempt AI-generated advertisements from the upcoming EU AI Act transparency requirements.

Eurocommerce, the European retail association whose members include Amazon , H&M, Inditex, and Ikea, is asking EU tech chief Henna Virkkunen to exempt ‌AI-generated advertisements from the bloc's new regulation requiring disclosure of AI use.

The European Union AI Act, which enters into force on August 2, requires companies to clearly label where artificial intelligence has been used to generate or modify images, video or audio content "constituting a deep fake".

As reported by Reuters, the industry group's director general Christel Delberghe said AI-generated ads not meant to mislead users should not be included under the definition of "deep fake".

Delberghe said the regulation should not include AI-generated ads "not intended to mislead users, for example, generating an ‌image of a living room to showcase a sofa, or enhancing product visuals for presentation purposes."

Retailers are already using AI widely to generate marketing images, with German online retailer Zalando saying the technology has allowed it to cut content production costs by 90%, while fast-fashion retailers H&M and Zara are using AI-generated clones of models.

Applying the regulation to AI-edited or AI-generated ads risks forcing retailers to label "a very large share of AI-assisted content", diluting the value of the disclosure to consumers, Delberghe wrote.

Precisely, the retail industry demands this exemption as AI-generated ads  are not intended to mislead consumers and shoudld not fall under the Act's "deep fake" or synthetic content disclosure requirements for a smooth buisiness push.