COMMISSION STAFF WORKING DOCUMENT EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT REPORT Accompanying the document Proposal for a Directive of the European Parliament and of the Council on adapting non-contractual civil liability rules to artificial intelligence (AI Liability Directive)
Date: 2022-09-28
Institutions: Directorate-General for Justice and Consumers, European Commission
Subjects: artificial intelligence, civil liability, civil liability proceedings, damage, digital technology, disclosure of information, evidence, information technology applications, new technology, proof

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   EUROPEAN COMMISSION  Brussels, 28.9.2022  SWD(2022) 320 final  COMMISSION STAFF WORKING DOCUMENT  EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT REPORT  Accompanying the document  Proposal for a Directive of the European Parliament and of the Council on adapting non-contractual civil liability rules to artificial intelligence (AI Liability Directive) {COM(2022) 496 final} - {SEC(2022) 344 final} - {SWD(2022) 318 final} - {SWD(2022) 319 final}  
 
 
Executive Summary Sheet  

Impact assessment on the initiative on civil liability for damage caused by AI 

A. Need for action 

What is the problem and why is it a problem at EU level?  

The  roll-out  of  AI  is  both  a  Commission  objective  and  an  expected  trend.  Although  AI-enabled 
products/services are expected to be safer than traditional ones, accidents will still occur.  

Current liability rules, in particular national rules based on fault, are not adapted to handle compensation 
claims  for  harm  caused  by  AI-enabled  products/services.  Under  such  rules,  victims  need  to  prove  a 
wrongful action/omission of a person that caused the damage. The specific characteristics of AI, including 
autonomy  and  opacity  (the  so-called  “black  box”  effect),  make  it  difficult  or  prohibitively  expensive  to 
identify the liable person and prove the requirements for a successful liability claim. 

The  Commission  wants  to  avoid  that  victims  of  harm  caused  by  AI,  e.g.  citizens,  businesses,  are  less 
protected than victims of traditional technologies. Such lack of compensation can affect their trust in AI 
and ultimately the uptake of AI-enabled products/services.  

It is uncertain how national liability rules can be applied to the specificities of AI. In addition, faced with a 
result, which is unjust for the victim, courts may apply existing rules on an ad hoc basis in a way to come 
to a just result. This will cause legal uncertainty. As a result, business will have difficulties to predict how 
the existing liability rules will be applied in case damage occurs. They will thus have difficulties to assess 
and insure their liability exposure. This impact is magnified in case of businesses active across borders as 
the uncertainty will cover different jurisdictions. It will affect particularly SMEs, which cannot rely on in-
house legal expertise or capital reserves. 

It is also expected that, if the EU does not act, Member States will adapt their national liability rules to the 
challenges of AI. This will result in further fragmentation and increase costs for businesses active across 
borders. 

What should be achieved? 

The initiative delivers on the Commission’s priority for the digital transition. The overarching objective is 
to promote the rollout of trustworthy AI to harvest the full benefits of AI.  Therefore the AI White Paper 
aims at creating an ecosystem of trust to promote the uptake of AI. The liability initiative is the necessary 
corollary of safety rules adapted to AI and complements thus the AI Act. 

The AI initiative will: 

-  Ensure that victims of AI-enabled products/services are equally protected as victims of traditional 

technologies.   

-  Reduce legal uncertainty regarding the liability exposure of businesses developing or using AI. 
-  Prevent the emergence of fragmented AI-specific adaptations of national civil liability rules. 

What is the value added of action at the EU level (subsidiarity)?  

Promoting the roll-out of AI in Europe implies the need to open the EU single market to those economic 
operators who want to develop or adopt AI in their businesses.  

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The prerequisites are to reduce legal uncertainty and to prevent fragmentation, if Member States start on 
their own adapting national rules in a diverging manner. 

Conservative estimates suggest that action at EU level on liability for AI would have a positive impact of 
5-7% increase on the production value of relevant cross-border trade compared to the baseline scenario. 

B. Solutions 

What are the various options to achieve the objectives? Is there a preferred option or not? If not, 
why? 

Policy option 1: three measures to alleviate the victims’ burden to prove their liability claim: 

a) Harmonising how the information recorded/documented according to the product safety rules of the AI 
Act can be disclosed in court proceedings so that the victim can identify and prove which action/omission 
led to the damage suffered.  

b) If the victim shows that the liable person did not comply with AI Act safety requirements designed to 
prevent  damage,  the  courts  could  presume  that  this  non-compliance  caused  the  damage.  The  potentially 
liable person would have the opportunity to rebut such a presumption, e.g. by proving than another cause 
led to the damage. 

c) In case the only way for the victim to prove the liability claim is to demonstrate what happened inside 
the  AI,  such  burden  on  the  victim  would  be  alleviated.  The  potentially  liable  person  would  have  the 
opportunity to prove that they did not act negligently. 

Policy option 2: the measures under Option 1 + harmonising a strict liability regime for AI use cases with 
a particular risk profile. Strict liability means that a person who exposes the public to a risk (often for legal 
interests  of  high  value  (life,  health,  property))  and  draws  a  benefit  from  it,  is  liable  if  such  risk 
materialises,  e.g.  the  liability  for  a  car  owner.  In  such  cases,  the  victim  only  needs  to  prove  that  the 
materialised damage stems from the risk sphere of the liable person. This can be coupled with a mandatory 
insurance. 

Policy option 3: staged approach (preferred policy option) consisting of a 

- First stage: the measures under Option 1, and 

- Second stage: a review mechanism to re-assess the need for harmonising strict liability for AI use cases 
with a particular risk profile (possibly coupled with a mandatory insurance). 

What are different stakeholders' views? Who supports which option?  

Overall, the majority of stakeholders agreed with the problems identified and supported action at EU level.  

EU citizens, consumer organizations and academic institutions overwhelmingly confirmed the need of EU 
action  to  ease  victims’  problems  with  the  burden  of  proof.  Businesses,  while  recognising  the  negative 
effects  of  the  uncertainty  around  the  application  of  liability  rules,  were  more  cautious  and  asked  for  a 
targeted intervention to avoid limiting innovation. 

A  similar  picture  appeared  regarding  the  policy  options.  EU  citizens,  consumer  organizations  and 
academic  institutions  strongly  supported,  as  a  minimum,  the  measures  on  the  burden  of  proof.  They 

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advocated also for the strongest measure, harmonising strict liability coupled with mandatory insurance. 

Businesses  were  more  divided,  also  depending  on  their  size.  Strict  liability  was  considered 
disproportionate.  Harmonisation  of  the  alleviations  of  the  burden  of  proof  gained  more  support,  in 
particular among SMEs. However, businesses cautioned against a complete shift of the burden of proof. 

C. Impacts of the preferred option 

What are the benefits of the preferred option (if any, otherwise of main ones)?                                     

The  preferred  policy  option  would  ensure  that  victims  of  AI-enabled  products  and  services  (natural 
persons,  businesses  and  any  other  public  or  private  entities)  are  not  less  protected  than  victims  of 
traditional technologies. It would increase the level of trust in AI and promote its uptake. 

Furthermore,  the  initiative  would  reduce  legal  uncertainty  and  prevent  fragmentation,  thus  helping 
companies, and most of all SMEs, that want to realise the full potential of the EU single market by rolling 
out AI-enabled products and services cross-border.  

The  initiative  would  also  improve  the  conditions  for  insurers  to  offer  coverage  of  AI-related  activities, 
which is crucial in particular for SMEs to manage their risks. 

In terms of environmental benefits, the initiative is expected to generate efficiencies and contribute to the 
innovation of environmentally friendly technologies. 

The cutting-edge products and services that this initiative aims to promote are for the most part not yet on 
the  market.  The  proposed  measures  are  ahead  of  the  curve  as  they  adapt  the  legal  framework  to  the 
specific needs and challenges of AI, so as to create an ecosystem of trust and legal certainty.  

Due to this forward looking policy approach, no sufficient data is available for quantifying the impacts of 
the  preferred  policy  option.  These  impacts  were  therefore  mainly  assessed  qualitatively,  taking  into 
account all available data, expert estimates and stakeholder input. Based on reasoned assumptions, some 
quantification approaches were pursued.  

It is namely estimated that the preferred policy option would generate an increased AI market value in the 
EU-27 between ca. EUR 500mln and ca. EUR 1.1bln in 2025. Moreover, a micro-economic analysis based 
on market data for robotic vacuum cleaners suggests that the initiative would generate an increase in total 
welfare of EUR 30.11-53.74mln for this product category alone in the EU-27. 

What are the costs of the preferred option (if any, otherwise of main ones)?                                    

The preferred policy option prevents  liability gaps  caused by the specific characteristics of AI.  It  would 
ensure that in the cases where the specific characteristics of AI would not have allowed the victim to prove 
the necessary facts, instead of the victim the person responsible for causing the damage bears the cost.  

This is in line with one of the fundamental purposes of liability law, i.e. to ensure that a person who harms 
another person in an illegal way will compensate the harm caused to the victim. It is also inherent in the 
Commission’s  policy  objective  to  ensure  that  victims  of  damage  caused  with  the  involvement  of  AI 
systems have the same level of protection as victims of damage caused by traditional technologies. It leads 
to a more efficient cost-allocation to the person who has actually caused the damage and is best placed to 
prevent damage from occurring.  

Potentially liable persons (in particular businesses active in the AI market) are highly likely to be covered 

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by insurance. Insurance solutions allow to spread the liability burden across the community of the insured, 
and thus limit liable persons’ costs to the annual insurance premiums. Insured liable persons would hence 
perceive the cost of compensation of the victim only as a marginal increase in their insurance premiums.  

A  highly  robust  and  precise  cost  quantification  was  not  possible  because  the  cutting-edge  products  and 
services promoted by this initiative are for the most part not yet on the  market. Based on available data, 
expert analysis and reasoned assumptions, it was estimated that the preferred policy option may lead to an 
increase  of  overall  amount  of  general  liability  insurance  premiums  paid  annually  in  the  EU  by  EUR 
5.35mln to EUR 16.1mln.  

What are the impacts on SMEs and competitiveness?  

By improving the conditions for the functioning of the internal market for AI-enabled products and 
services, the initiative would have a positive impact on the competitiveness of companies active in the 
European AI market. These companies would become more competitive on a global scale, which will 
strengthen the EU’s position vis-à-vis its competitors in the global AI race (primarily the US and China). 
As AI is a cross-cutting enabling technology, these benefits would not be limited to certain specific sectors 
but apply – albeit to varying degrees – in all sectors where AI is developed or used. 

SMEs would benefit even more than other stakeholders from reduced legal uncertainty and fragmentation, 
because they are more affected by these problems under the current liability rules. This initiative would 
improve the conditions in particular for SMEs wishing to roll-out AI-enabled products or services in other 
Member States. This is crucial because the EU’s AI market is driven to a large extent by SMEs 
developing, deploying or using AI technologies.  

SMEs would benefit from this initiative also as victims of damage caused by AI, as they could rely on the 
alleviations of their burden of proof to claim compensation.  

Will there be significant impacts on national budgets and administrations?  

No significant impacts on national budgets and administrations are expected. 

The envisaged measures easing victims’ burden of proof could be integrated without friction into Member 
States’ existing procedural and civil liability frameworks.  

Member States will have to report on the implementation of the initiative and provide certain information 
for  the  Commission’s  targeted  review.  However,  these  reporting  requirements  will  be  limited  to 
information  available  through  Member  States’  existing  databases  and  information  reported  under  other 
legal  instruments  (e.g.  the  AI  Act  or  the  Motor  Insurance  Directive),  which  will  achieve  synergies  and 
ensure the coherence of future policy measures across various policy areas.  

Will there be other significant impacts?  

Fundamental  rights:  The  initiative  will  contribute  to  supporting  the  effective  private  enforcement  of 
fundamental rights and preserve the right to an effective remedy where the fundamental rights risks of AI 
(e.g. discrimination) have materialised. 

International dimension: By putting forward a balanced approach regarding liability for damage caused by 
AI, the EU has the opportunity to set a global benchmark and promote its approach as a global solution, 
which would ultimately generate a competitive advantage for ‘AI made in Europe’.  

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Proportionality?  

The preferred option is designed to prepare the ground for the development and use of AI, while reaching 
the main objective of promoting its roll-out in the EU.  

However, this option will not go beyond what is necessary. Firstly, the EU intervention is targeted because 
it will only alleviate the burden of proof for victims. It will only harmonise elements of liability that are 
challenged  by  AI,  leaving  other  elements  like  the  determination  of  fault  and  causality  to  the  existing 
national laws.  

Secondly, the preferred option postpones the assessment of the need to harmonise strict liability to a later 
stage, when more information about the AI and its uses can be gathered (see further below). 

Thirdly,  the  preferred  option  will  propose  a  minimum  harmonisation  approach.  While  minimum 
harmonisation does not create an entirely level playing field, it ensures that the new rules can be integrated 
without frictions into the existing legal civil liability framework within each Member State.  

Thus, Member States will be able to integrate the targeted EU interventions of  the preferred option into 
their  national  law,  the  initiative  will  increase,  across  the  EU,  legal  certainty,  prevent  further  legal 
fragmentation and ensure effective protection of victims which is comparable with the protection level for 
other damages. 

D. Follow up 

When will the policy be reviewed?  

The  preferred  policy  option  comprises  of  a  staged  approach:  first  introducing  measures  to  alleviate  the 
burden of proof on the victim and then, on the basis of a review clause, assess the situation five years later. 
This  process  will  allow the  Commission  to  assess  in  light  of  the  development  of  the  technology  and  its 
uses  if,  in  addition  to  the  measures  alleviating  the  burden  of  proof,  harmonisation  of  strict  liability  and 
mandatory insurance is needed as well.  

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