Position: If Innovation in AI systematically Violates Fundamental Rights, Is It Innovation at All?

Josu Andoni Eguíluz Castañeira, Axel Brando, Migle Laukyte, Marc Serra-Vidal

Keywords: AI regulation, EU AI Act, high-risk AI systems, Fundamental Rights, Responsible Innovation, Innovation vs. Regulation, Collingridge Dilemma, Trustworthy AI, Human Oversight, AI Risk Mitigation.

TL;DR: No Innovation Without Regulation

Abstract: Artificial intelligence (AI) now permeates critical infrastructures and decisionmaking systems where failures produce social, economic, and democratic harm. This position paper challenges the entrenched belief that regulation and innovation are opposites. As evidenced by analogies from aviation, pharmaceuticals, and welfare systems and recent cases of synthetic misinformation, bias and unaccountable decision-making, the absence of well-designed regulation has already created immeasurable damage. Regulation, when thoughtful and adaptive, is not a brake on innovation—it is its foundation. The present position paper examines the EU AI Act as a model of risk-based, responsibility-driven regulation that addresses the Collingridge Dilemma: acting early enough to prevent harm, yet flexibly enough to sustain innovation. Its adaptive mechanisms—regulatory sandboxes, small and medium enterprises (SMEs) support, real-world testing, fundamental rights impact assessment (FRIA)—demonstrate how regulation can accelerate responsibly, rather than delay, technological progress. The position paper summarises how governance tools transform perceived burdens into tangible advantages: legal certainty, consumer trust, and ethical competitiveness. Ultimately, the paper reframes progress: innovation and regulation advance together. By embedding transparency, impact assessments, accountability, and AI literacy into design and deployment, the EU framework defines what responsible innovation truly means—technological ambition disciplined by democratic values and fundamental rights.

Lay Summary:

Artificial Intelligence (AI) is transforming how societies make decisions—from credit scoring to healthcare and public services. Yet when AI operates without clear rules, it can spread misinformation, reinforce discrimination, and make decisions no one can contest. These failures are not technical flaws but consequences of missing safeguards.

This paper argues that well-designed regulation is not a brake on innovation—it is what enables it to thrive responsibly. Drawing lessons from aviation, medicine, and digital governance, we show that the European Union’s AI Act offers a practical model for risk-based and innovation-friendly governance. Its tools—such as regulatory sandboxes—allow companies to experiment safely while protecting people’s rights.

By viewing regulation as part of the innovation process rather than its opposite, this study reframes progress itself. Responsible innovation means creating technology that strengthens, rather than undermines, democracy and human values. In short, AI will remain truly innovative only if it also remains accountable.

Submission Number: 119