Italy sets up €1B AI fund, mulls new penalties for the tech’s misuse

Backed by state lender Cassa Depositi e Prestiti (CDP), Italy is committing €1bn to AI development over the course of the next five years.

Prime Minister Giorgia Meloni first announced the plan for a dedicated AI fund last month. “The purpose of this mechanism is clearly to act as a multiplier and serve to attract further investment,” Meloni said in a video message.

CDP’s venture capital arm will provide the capital, divided into three areas. Some €580mn will be invested in startups, while €300mn will go to more mature companies that are ready to scale abroad.

The remaining €120mn will target the technology transfer from university research to market.

Meanwhile, Italy is also drawing up its own AI legislation that will establish rules complementary to the EU’s AI Act.

“This technology can only achieve its full potential if it is developed within a framework of ethical rules that focus on people and their rights and needs,” Meloni said. “This is the compass that has guided and will continue to guide our work, at all levels.”

Part of the draft bill are potential heavy penalties for crimes assisted by AI tools, sources familiar with the matter told Reuters. Among the offences are money laundering, market rigging, and copyright infringement. It’s still unclear when — and if — the law will enter into force.

Italy’s new investment plan and expected legislation both mirror the EU’s broader movement not only to strengthen innovation and economic competitiveness in the field, but also establish guardrails to mitigate potential risks.