Last night, the EU Commission sent its analysis on how to curb gas prices to the member states. At their last meeting three weeks ago, the energy ministers had explicitly asked for proposals. But now, the Commission drastically shows the consequences of a general gas price cap. To ensure gas flows between member states, a central distribution player would have to be created, writes Manuel Berkel in his analysis of the non-paper available to Europe.Table.
The EU Commission also announced new sanctions against Russia yesterday. According to a proposal by Commission President Ursula von der Leyen, the eighth package is to include, among other things, a price cap on Russian oil. The price cap is intended to reduce Russian revenues while stabilizing the global oil market. You can read details on the proposal in our news section.
A new industrial alliance from Germany is to promote the production of technology components for the energy transition in Europe and keep the EU competitive. The aim is to encourage the manufacture of products such as heat pumps, wind turbines, or photovoltaics in European plants. The initiative can count on support: EU Industry Commissioner Thierry Breton will offer his operational help at today’s Competitiveness Council, write Till Hoppe and Lukas Scheid.
Corinna Visser looked at how the EU Commission intends to revise the liability rules for products, some of which are very outdated. It will have to pay particular attention to artificial intelligence. In the future, it should be easier for consumers to make claims in the event of damage.
The EU Commission has warned against a Europe-wide price cap on gas markets. “Such a measure would require a political decision in advance on the method of allocating gas to member states and the criteria to be used in doing so,” it said in an analysis sent to member states on Wednesday evening.
A general gas price cap would also affect intra-EU gas trade, the commission writes. Currently, states, where supply is already compromised, could secure gas supplies from other EU countries through higher prices. A uniform price cap would eliminate this market-based distribution in the event of a gas shortage.
If the EU introduced a gas price cap, the paper said alternative mechanisms would have to be found to distribute scarce gas to member states and different categories of consumers. To this end, a new body would have to be created to take over tasks from gas pipeline operators, the Brussels-based authority writes.
“Administrative decision-making on gas flows is unprecedented in Europe, and there is currently no EU-level body equivalent to transmission system operators at a national level with the necessary experience and technical capabilities to undertake this task,” the analysis says.
According to the EU Commission, a gas price cap would also affect the disconnections of gas customers. What is needed, is a “much stricter legal framework for consumption reductions” because higher gas consumption can be expected due to artificially capped prices. According to the Commission, setting an appropriate price cap also poses risks to the security of supply.
In addition to a general gas price cap, the EU Commission analyzes the possibilities for other emergency interventions in the energy markets. For example, it says the Commission is willing to discuss temporary measures to limit the impact of high gas prices on electricity prices. However, the costs would have to be borne by member states’ electricity markets.
The Commission’s analysis follows a meeting of EU energy ministers in Brussels in mid-September. The member states had asked the Commission to submit proposals for a gas price cap. According to the analysis sent on Wednesday, the Commission intends to present concrete proposals for measures to reduce gas prices in the coming week, according to information from Europe.Table.
On Wednesday, 15 European states had also called again for a gas price cap to limit excess profits and curb inflation. The price cap should be applied to all wholesale gas transactions, according to the letter published this morning by the energy ministers of France, Italy, Spain, Poland and other states. The German government had not signed the call.
A self-steering sweeping robot drives down the street and rams into a baby carriage. The infant inside is injured in the accident. It is clear that a human being was injured and that the autonomously driving robot caused it. But who will pay for the damage? The manufacturer of the artificial intelligence (AI) integrated into the system? The producer of the sensors or the tracking system? The sweeping robots fleet operator? The public utility company placing the cleaning order? Who should the mother hold accountable? And if the AI lay at fault: How is she supposed to prove it if AI is largely a black box for outsiders?
When something goes wrong with autonomous systems using artificial intelligence, so many questions arise that the EU Commission has dedicated a separate legal act to the issue of liability. On Wednesday, EU Justice Commissioner Didier Reynders presented the AI Liability Directive in Brussels. At the same time, the Commission presented a revision of the General Product Liability Directive (PLD).
The background to this is that products are increasingly digitized, complex, and thus not transparent, and, if they work with AI, can make autonomous decisions. The new directive is an attempt to adapt existing product liability law to products that had not been thought of at the directive’s creation in 1985. For example, the existing directive does not address who is liable for defects in software updates, machine learning algorithms, or digital services related to a product.
The goal: According to the Commission it is important to strengthen the rights of consumers on the one hand, but also to create legal certainty for companies and a level playing field with non-European providers on the other. Representatives of the Commission emphasize that they were concerned to strike a fair balance between the two sides. After all, as Reynders also emphasizes, the Commission wants to promote – and in no way restrict – the development of innovative AI systems in the EU.
Another interesting point is that the new rules also take into account products that have been updated, modified, or reconditioned. The proposal creates the legal clarity that the industry needs to incorporate circular-oriented business models, the Commission says.
The question arises as to whether it is reasonable for the Commission to make two legal acts out of product liability and AI liability. Axel Voss, the legal policy spokesman for the EPP Group, believes this is the right thing to do because product liability and AI liability are not comparable. A discriminatory AI is not a broken washing machine, he said. “Suddenly we have a fundamental rights issue,” Voss says. “So we’re talking about particular products. Thus it makes sense to find separate rules for the liability issue.”
The product liability expert Thomas Klindt, partner at the law firm Noerr, agrees: “After all, the genetic differences between classical liability for defects of haptic products on the one hand and ‘defects’ of self-learning algorithms, on the other hand, are possibly so gigantic that we will be grateful for a separation into two different legal acts.”
And while the AI Act only regulates high-risk applications, the AI Liability Directive applies to all AI – except Article 3, which deals with the injured parties’ right to information, which they only have in the case of high-risk applications. Here, the Commission does not want to introduce documentation requirements other than those provided for in the AI Act. This means that the rebuttable presumption in Article 4 also applies to other AIs. The system: The victim has a right to information; if the defendant cannot fulfill this right, the – refutable – presumption that a breach has occurred automatically applies.
According to the Product Liability Directive, manufacturers are liable for damage caused by defective products regardless of fault. This also applies to AI systems. However, the Product Liability Directive is not the only piece of legislation in this area, so in many cases, injured parties can choose on which legal basis they want to claim damages.
AI liability eases the burden of proof for victims and makes it easier for them to access relevant evidence. It is debatable whether this is enough for the victims. It is obvious that it will mean more work for companies. “Statutory burden-of-proof distributions at least have the one advantage that business can adjust to them with a clear eye,” Klindt says. That means clear documentation that enables to document decisions in organizations and well-archived documents that can serve as evidence later, he says. “This documentation management must be understood as a general management task,” says Klindt.
In its own view, the Commission lowered the hurdles for victims to claim damage, in both product and AI liability. It has dispensed with a complete reversal of the burden of proof in the case of AI liability.
Consumer advocates see progress in the new regulations in some areas, but consider them too weak for AI-driven services. Unlike traditional product liability rules, a consumer harmed by an AI would have to prove that the AI caused the harm, and someone would have to prove fault or negligence.
“Asking consumers to do this is a real disappointment,” says Ursula Pachl, Deputy Director General of the European Consumers’ Organisation (BEUC). She says, in the face of highly complex and intransparent “black box” AI systems, that is virtually impossible. “The bottom line is that consumers will be better protected if a lawnmower shreds their shoes in the garden than if they are unfairly discriminated against by a credit scoring system.”
But BEUC also sees positive developments, such as the fact that the PLD
The Computer & Communications Industry Association, on the other hand, believes it is wrong to view software as a tangible product. Software continues to evolve over time and “has never in itself caused physical harm,” the industry association writes. Data loss, psychological damage, and other immaterial damage should not be part of the PLD’s strict liability regime – “it is not the right instrument for such complex issues.”
René Repasi, lawyer and internal market expert at S&D, considers the new regulations in AI liability to be better than the current law. However, he says, the requirements for the presumption of proof are so high that they are probably impossible to lead in practice. “Thus, the injured person is left without rights. That can’t be it.”
Now it is the turn of the Parliament’s court. It is still undecided whether the Internal Market Committee or the Legal Affairs Committee will be in charge of the AI dossier. Until now, AI liability built upon product liability. “If both dossiers go to different committees, we risk getting different liability regimes,” Repasi says. “My view is that AI is a product. And in case of harm, it should be treated like a harmful product.” The parliamentary debate is on.
Jens Gieseke is a “passionate cyclist.” Coming from the Emsland region, where everything is flat and manageable, this is his transportation of choice. “Without an electric motor, by the way. Only with his own muscle power,” emphasizes the CDU/CSU spokesman on cycling policy in the European Parliament.
As Vice Chairman of the Committee on Transport and Tourism (TRAN), mobility is his main topic. It’s been on his mind ever since he studied law, which also didn’t keep him in one place. He studied in Osnabrück, Lausanne, Geneva and Freiburg. “Mobility and studying have always belonged together for me,” says Gieseke.
After the 1st state exam, he works for one year as a research assistant for the European Parliament in Strasbourg. After the 2nd state exam, he moves to Brussels, where he holds various EU jobs. Since 2014 he is a Member of the European Parliament.
In the Transport Committee, he accompanies the debate for the Alternative Fuels Infrastructure Regulation(AFIR) and the carbon fleet regulation as shadow rapporteur for the EPP. The Commission’s proposal to introduce a 100 percent reduction in carbon emissions by 2035 for passenger cars and light commercial vehicles was adopted by the Parliament, to Gieseke’s regret. He would have liked to prevent the “de facto ban on internal combustion vehicles” but was unable to get his way.
Gieseke thinks: If alternative forms of propulsion that would also be carbon-neutral could be produced demonstrably, he says, they should be given a chance. “For me, this also includes e-fuels.”
Before the vote in Parliament, Gieseke campaigned for a voluntary crediting system for synthetic fuels, but it narrowly failed to win a majority in the plenary. Under this system, manufacturers could receive credits toward their carbon fleet limits for the independent production of renewable fuels.
The Parliament, he says, is adopting more hydrogen-based renewable fuels, but at the same time is speaking out against internal combustion engines. “Of course, this is not a coherent policy,” Gieseke criticizes. He says the two concepts need to be brought together, ideally with a more technology-neutral approach. “I didn’t go into politics with the idea of banning things, but ideally setting a framework that allows competition for the best technology,” he explains.
E-fuels are carbon-neutral on balance, he says, and can be produced because of renewable energy. “In a way, EVs are artificially preferred,” Gieseke says. With them, upstream carbon emissions are ignored, he says. If Gieseke could have his way, such decisions should come from the market rather than the legislator.
“I’m not against electromobility, but not everything needs to be electric if there are different needs,” Gieseke says. Specifically, he is working on continuing his crediting process for synthetic fuels. “So that in the end we’re not talking about wishes, but about legal reality and implementation, to actually anchor this crediting legislatively.” He has the opportunity to do so in the trialogue between the Parliament, the Council, and the Commission, where the revision of the carbon fleet limits is finally negotiated. However, the Commission would have to make a corresponding regulatory proposal in a timely manner. Livia Hofmann
Last night, the EU Commission sent its analysis on how to curb gas prices to the member states. At their last meeting three weeks ago, the energy ministers had explicitly asked for proposals. But now, the Commission drastically shows the consequences of a general gas price cap. To ensure gas flows between member states, a central distribution player would have to be created, writes Manuel Berkel in his analysis of the non-paper available to Europe.Table.
The EU Commission also announced new sanctions against Russia yesterday. According to a proposal by Commission President Ursula von der Leyen, the eighth package is to include, among other things, a price cap on Russian oil. The price cap is intended to reduce Russian revenues while stabilizing the global oil market. You can read details on the proposal in our news section.
A new industrial alliance from Germany is to promote the production of technology components for the energy transition in Europe and keep the EU competitive. The aim is to encourage the manufacture of products such as heat pumps, wind turbines, or photovoltaics in European plants. The initiative can count on support: EU Industry Commissioner Thierry Breton will offer his operational help at today’s Competitiveness Council, write Till Hoppe and Lukas Scheid.
Corinna Visser looked at how the EU Commission intends to revise the liability rules for products, some of which are very outdated. It will have to pay particular attention to artificial intelligence. In the future, it should be easier for consumers to make claims in the event of damage.
The EU Commission has warned against a Europe-wide price cap on gas markets. “Such a measure would require a political decision in advance on the method of allocating gas to member states and the criteria to be used in doing so,” it said in an analysis sent to member states on Wednesday evening.
A general gas price cap would also affect intra-EU gas trade, the commission writes. Currently, states, where supply is already compromised, could secure gas supplies from other EU countries through higher prices. A uniform price cap would eliminate this market-based distribution in the event of a gas shortage.
If the EU introduced a gas price cap, the paper said alternative mechanisms would have to be found to distribute scarce gas to member states and different categories of consumers. To this end, a new body would have to be created to take over tasks from gas pipeline operators, the Brussels-based authority writes.
“Administrative decision-making on gas flows is unprecedented in Europe, and there is currently no EU-level body equivalent to transmission system operators at a national level with the necessary experience and technical capabilities to undertake this task,” the analysis says.
According to the EU Commission, a gas price cap would also affect the disconnections of gas customers. What is needed, is a “much stricter legal framework for consumption reductions” because higher gas consumption can be expected due to artificially capped prices. According to the Commission, setting an appropriate price cap also poses risks to the security of supply.
In addition to a general gas price cap, the EU Commission analyzes the possibilities for other emergency interventions in the energy markets. For example, it says the Commission is willing to discuss temporary measures to limit the impact of high gas prices on electricity prices. However, the costs would have to be borne by member states’ electricity markets.
The Commission’s analysis follows a meeting of EU energy ministers in Brussels in mid-September. The member states had asked the Commission to submit proposals for a gas price cap. According to the analysis sent on Wednesday, the Commission intends to present concrete proposals for measures to reduce gas prices in the coming week, according to information from Europe.Table.
On Wednesday, 15 European states had also called again for a gas price cap to limit excess profits and curb inflation. The price cap should be applied to all wholesale gas transactions, according to the letter published this morning by the energy ministers of France, Italy, Spain, Poland and other states. The German government had not signed the call.
A self-steering sweeping robot drives down the street and rams into a baby carriage. The infant inside is injured in the accident. It is clear that a human being was injured and that the autonomously driving robot caused it. But who will pay for the damage? The manufacturer of the artificial intelligence (AI) integrated into the system? The producer of the sensors or the tracking system? The sweeping robots fleet operator? The public utility company placing the cleaning order? Who should the mother hold accountable? And if the AI lay at fault: How is she supposed to prove it if AI is largely a black box for outsiders?
When something goes wrong with autonomous systems using artificial intelligence, so many questions arise that the EU Commission has dedicated a separate legal act to the issue of liability. On Wednesday, EU Justice Commissioner Didier Reynders presented the AI Liability Directive in Brussels. At the same time, the Commission presented a revision of the General Product Liability Directive (PLD).
The background to this is that products are increasingly digitized, complex, and thus not transparent, and, if they work with AI, can make autonomous decisions. The new directive is an attempt to adapt existing product liability law to products that had not been thought of at the directive’s creation in 1985. For example, the existing directive does not address who is liable for defects in software updates, machine learning algorithms, or digital services related to a product.
The goal: According to the Commission it is important to strengthen the rights of consumers on the one hand, but also to create legal certainty for companies and a level playing field with non-European providers on the other. Representatives of the Commission emphasize that they were concerned to strike a fair balance between the two sides. After all, as Reynders also emphasizes, the Commission wants to promote – and in no way restrict – the development of innovative AI systems in the EU.
Another interesting point is that the new rules also take into account products that have been updated, modified, or reconditioned. The proposal creates the legal clarity that the industry needs to incorporate circular-oriented business models, the Commission says.
The question arises as to whether it is reasonable for the Commission to make two legal acts out of product liability and AI liability. Axel Voss, the legal policy spokesman for the EPP Group, believes this is the right thing to do because product liability and AI liability are not comparable. A discriminatory AI is not a broken washing machine, he said. “Suddenly we have a fundamental rights issue,” Voss says. “So we’re talking about particular products. Thus it makes sense to find separate rules for the liability issue.”
The product liability expert Thomas Klindt, partner at the law firm Noerr, agrees: “After all, the genetic differences between classical liability for defects of haptic products on the one hand and ‘defects’ of self-learning algorithms, on the other hand, are possibly so gigantic that we will be grateful for a separation into two different legal acts.”
And while the AI Act only regulates high-risk applications, the AI Liability Directive applies to all AI – except Article 3, which deals with the injured parties’ right to information, which they only have in the case of high-risk applications. Here, the Commission does not want to introduce documentation requirements other than those provided for in the AI Act. This means that the rebuttable presumption in Article 4 also applies to other AIs. The system: The victim has a right to information; if the defendant cannot fulfill this right, the – refutable – presumption that a breach has occurred automatically applies.
According to the Product Liability Directive, manufacturers are liable for damage caused by defective products regardless of fault. This also applies to AI systems. However, the Product Liability Directive is not the only piece of legislation in this area, so in many cases, injured parties can choose on which legal basis they want to claim damages.
AI liability eases the burden of proof for victims and makes it easier for them to access relevant evidence. It is debatable whether this is enough for the victims. It is obvious that it will mean more work for companies. “Statutory burden-of-proof distributions at least have the one advantage that business can adjust to them with a clear eye,” Klindt says. That means clear documentation that enables to document decisions in organizations and well-archived documents that can serve as evidence later, he says. “This documentation management must be understood as a general management task,” says Klindt.
In its own view, the Commission lowered the hurdles for victims to claim damage, in both product and AI liability. It has dispensed with a complete reversal of the burden of proof in the case of AI liability.
Consumer advocates see progress in the new regulations in some areas, but consider them too weak for AI-driven services. Unlike traditional product liability rules, a consumer harmed by an AI would have to prove that the AI caused the harm, and someone would have to prove fault or negligence.
“Asking consumers to do this is a real disappointment,” says Ursula Pachl, Deputy Director General of the European Consumers’ Organisation (BEUC). She says, in the face of highly complex and intransparent “black box” AI systems, that is virtually impossible. “The bottom line is that consumers will be better protected if a lawnmower shreds their shoes in the garden than if they are unfairly discriminated against by a credit scoring system.”
But BEUC also sees positive developments, such as the fact that the PLD
The Computer & Communications Industry Association, on the other hand, believes it is wrong to view software as a tangible product. Software continues to evolve over time and “has never in itself caused physical harm,” the industry association writes. Data loss, psychological damage, and other immaterial damage should not be part of the PLD’s strict liability regime – “it is not the right instrument for such complex issues.”
René Repasi, lawyer and internal market expert at S&D, considers the new regulations in AI liability to be better than the current law. However, he says, the requirements for the presumption of proof are so high that they are probably impossible to lead in practice. “Thus, the injured person is left without rights. That can’t be it.”
Now it is the turn of the Parliament’s court. It is still undecided whether the Internal Market Committee or the Legal Affairs Committee will be in charge of the AI dossier. Until now, AI liability built upon product liability. “If both dossiers go to different committees, we risk getting different liability regimes,” Repasi says. “My view is that AI is a product. And in case of harm, it should be treated like a harmful product.” The parliamentary debate is on.
Jens Gieseke is a “passionate cyclist.” Coming from the Emsland region, where everything is flat and manageable, this is his transportation of choice. “Without an electric motor, by the way. Only with his own muscle power,” emphasizes the CDU/CSU spokesman on cycling policy in the European Parliament.
As Vice Chairman of the Committee on Transport and Tourism (TRAN), mobility is his main topic. It’s been on his mind ever since he studied law, which also didn’t keep him in one place. He studied in Osnabrück, Lausanne, Geneva and Freiburg. “Mobility and studying have always belonged together for me,” says Gieseke.
After the 1st state exam, he works for one year as a research assistant for the European Parliament in Strasbourg. After the 2nd state exam, he moves to Brussels, where he holds various EU jobs. Since 2014 he is a Member of the European Parliament.
In the Transport Committee, he accompanies the debate for the Alternative Fuels Infrastructure Regulation(AFIR) and the carbon fleet regulation as shadow rapporteur for the EPP. The Commission’s proposal to introduce a 100 percent reduction in carbon emissions by 2035 for passenger cars and light commercial vehicles was adopted by the Parliament, to Gieseke’s regret. He would have liked to prevent the “de facto ban on internal combustion vehicles” but was unable to get his way.
Gieseke thinks: If alternative forms of propulsion that would also be carbon-neutral could be produced demonstrably, he says, they should be given a chance. “For me, this also includes e-fuels.”
Before the vote in Parliament, Gieseke campaigned for a voluntary crediting system for synthetic fuels, but it narrowly failed to win a majority in the plenary. Under this system, manufacturers could receive credits toward their carbon fleet limits for the independent production of renewable fuels.
The Parliament, he says, is adopting more hydrogen-based renewable fuels, but at the same time is speaking out against internal combustion engines. “Of course, this is not a coherent policy,” Gieseke criticizes. He says the two concepts need to be brought together, ideally with a more technology-neutral approach. “I didn’t go into politics with the idea of banning things, but ideally setting a framework that allows competition for the best technology,” he explains.
E-fuels are carbon-neutral on balance, he says, and can be produced because of renewable energy. “In a way, EVs are artificially preferred,” Gieseke says. With them, upstream carbon emissions are ignored, he says. If Gieseke could have his way, such decisions should come from the market rather than the legislator.
“I’m not against electromobility, but not everything needs to be electric if there are different needs,” Gieseke says. Specifically, he is working on continuing his crediting process for synthetic fuels. “So that in the end we’re not talking about wishes, but about legal reality and implementation, to actually anchor this crediting legislatively.” He has the opportunity to do so in the trialogue between the Parliament, the Council, and the Commission, where the revision of the carbon fleet limits is finally negotiated. However, the Commission would have to make a corresponding regulatory proposal in a timely manner. Livia Hofmann
