Do I need to tell customers my website uses AI recommendations?

If the recommendations significantly affect customers, such as financial or insurance products, yes. For general product recommendations, disclosure is good practice but may not be legally required.

What is the penalty for not disclosing AI use?

Under the EU AI Act, failing to meet transparency obligations can result in fines up to 15 million euros or 3 percent of global revenue, whichever is higher.

How should I disclose AI use in my chatbot?

Add a clear, visible notice that the customer is communicating with an AI system. A simple message at the start of the conversation is sufficient. Make it easy for customers to request a human instead.

Quick answer

In many cases, yes. The EU AI Act requires disclosure when customers interact with AI systems like chatbots. GDPR requires informing people about automated decision-making. Even where not legally required, transparency about AI use builds trust and is becoming a business best practice.

Updated June 2026 · MmowW AI Compliance

Do I Need to Tell Customers I Use AI?

Legal Requirements for AI Disclosure

The EU AI Act creates specific transparency obligations. If customers interact with an AI system designed to communicate with people, such as a chatbot, you must tell them they are interacting with AI. If you use AI to generate or manipulate content like images, audio, or text, you must disclose that it is AI-generated.

GDPR adds another layer. If AI makes decisions about customers automatically, such as credit scoring, insurance pricing, or personalized offers, customers have the right to know about the automated processing and to challenge these decisions. This applies whether or not the EU AI Act separately requires disclosure.

When Disclosure Is Clearly Required

You must disclose AI use in these situations: AI chatbots or virtual assistants that communicate with customers, AI-generated content presented as if human-created, automated decisions that significantly affect customers such as credit or insurance decisions, AI systems that detect emotions or categorize people based on biometric data, and AI used for real-time identification of individuals.

When Disclosure Is Optional but Smart

Even when not legally required, disclosing AI use is often good business practice. Using AI to draft customer emails, personalize marketing, recommend products, or analyze customer behavior may not always trigger legal disclosure requirements, but transparency builds trust. Customers increasingly want to know when AI is involved in their experience.

How to Communicate AI Use Effectively

Good AI disclosure is clear, concise, and non-alarming. Instead of burying it in a terms of service document, include a brief, friendly notice where customers encounter AI. For chatbots, a simple statement like some responses are generated with AI assistance works well. Update your privacy policy to include AI processing. Make disclosure informative rather than frightening.

Staying Current With AI Law

AI regulation is evolving faster than almost any other area of law. What is compliant today may not be sufficient next year. Build a habit of checking for regulatory updates at least monthly. Subscribe to updates from your national AI authority, your industry association, and reputable AI compliance publications.

Do not try to become a legal expert yourself. Instead, build a relationship with a legal advisor who understands AI regulation and can help you interpret new requirements as they emerge. Even a brief annual consultation can save you from costly compliance mistakes. The investment in staying informed is small compared to the cost of discovering too late that your practices have fallen behind the law.

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This article is for informational purposes only and does not constitute legal advice. Regulatory requirements change frequently — verify current rules with official sources. Built by Sawai Gyoseishoshi Office, Hiroshima, Japan.