The Commission proposal of withdrawing the draft AI Liability Directive: a “strategic error” both from an institutional and content perspective? (1)

by Emilio DE CAPITANI

Maybe it is a pure coincidence, but the Commission proposal to withdraw the drat AI liability Directive seems to be the immediate answer to the US Vice-president, J.D. Vance request at the Artificial Intelligence Action Summit in Paris that the EU (and its Member States) should avoid any regulation deemed (by the US) too “aggressive” against the American technology giants. To confirm such suspicion are the Commission Vice President Sefcovic justifications according to which the Commission was withdrawing the text because of the “lack of progress” in the legislative process. This justification is simply unfounded because both the Council and the Parliament are currently actively working on the issue : the Council is debating the reactions of the Member States on the Commission’s proposal (see here and here) and the European Parliament held an hearing on this subject not later than two weeks ago, following which the EP Rapporteur has already announced a draft report in the coming months.

So, the Commission justification for withdrawing the AI Liability Directive proposal because of lack of progress is factually unfounded and, even, legally questionable. (see my other general post Here). Suffice to remember that according to the CJEU judgement withdrawing a legislative proposal may be justified only  ‘where an amendment planned by the Parliament and the Council distorts the proposal for a legislative act in a manner which prevents achievement of the objectives pursued by the proposal and which, therefore, deprives it of its raison d’être, the Commission is entitled to withdraw it’. It may however do so only after having had due regard to Parliament’s and Council’s concerns behind their wish to amend the proposal.” (C- C‑409/13, p.83). Again this seems to be of common sense interpretation. Until the Treaty will not recognize a full right of legislative initiative to the EP and to the Council these institutions may only ask the Commission to submit a legislative proposal (art.225 of the TFEU for the EP).

However, until now no formal amendment depriving the AI Liability proposal of its raison d’être have been tabled by the EP or by the Council so that the co-legislator may well continue to work on the current legislative proposal. Needless to say that, in case of formal withdrawal of the text by the Commission the co-legislators or even only one of them may well bring that institution to the Court for infringement of the principle of conferral and of Institutional Balance.

(continue)