Risk-based approach to AI regulation: the role for co-regulation

Artificial intelligence (AI) is a key policy area that has seen an increasing adaptation of risk regulation. This article examines the emergence and operation of co-regulation, a hybrid form of regulation in which public and private actors coordinate their regulatory activities under the increasingly risk-based approach to AI risk governance. Based on an analysis of the emerging co-regulatory arrangements in European Union (EU) AI Act, the article notes that there are significant challenges in implementing such public-private arrangements and discusses some fundamental conditions under which they can achieve the societal goals of safety and fundamental rights. In particular, it argues that achieving these objectives requires an EU regulatory framework that promotes adequate regulatory capacity by ensuring data sharing and information exchange between private and public actors. The EU framework must respond and adapt to changing risk profiles and industry developments to ensure that public oversight of AI is risk-based, transparent, and not captured by industry power. This is particularly important to promote compliance and create an effective regulatory framework.