AI-generated ads should be exempt from EU transparency rules, retail association says

By Helen Reid

LONDON, June 19 (Reuters) - 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".  

In a letter sent to Virkkunen on Thursday and seen by Reuters on Friday, 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".

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", the letter said.

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. 

The European Commission did not immediately reply to a request for comment.

(Reporting by Helen Reid; Editing by Emelia Sithole-Matarise)