For Antonio Tejeda Encinas, Chairman
Euro American Committee on Digital Law – EA Digital Law
PCDD-Citizen Participation. Democracy. Digital Rights
The previous article, “Artificial Intelligence and the Systemic Crisis of the Spanish Public Administration“I expressed a worrying reality: the coexistence of ambitious legislation in artificial intelligence with a Spanish public administration that still faces significant challenges in its digitization. Problems of technological obsolescence, lack of interoperability, insufficient digital training in civil servants and competition discoordination raise serious doubts about the ability of the Spanish public sector to implement and manage AI systems effectively and ethically. In this context, the recent proposal to exclude public administrations (AAPP) from the sanctioning regime in the Preliminary Draft Law on Good Use and Governance of AI adds a new layer of complexity and potential risk.
This preliminary draft, approved in the Council of Ministers on 11 March 2025, seeks to establish a regulatory framework for the development and use of artificial intelligence in Spain, adapting national legislation to Regulation (EU) 2024/1689 (AI Regulation Act).
Communication with the European Act AI Regulation (EU) 2024/1689 establishes a common legal framework for artificial intelligence in the European Union, applicable to both the private and public sectors. The exclusion of PPPs from the sanction regime in the Spanish preliminary draft could lead to discrepancies with the Community framework, as the European regulation does not provide for such exemptions for public administrations. This divergence could lead to conflicts in the application of regulations and questions about Spain’s compliance with European obligations.
Specifically:
Impact on regulatory harmonisation within the EU:
The regulation sets uniform standards to ensure that all actors, public and private, are responsible for the use of AI. The Spanish exemption could be interpreted as a violation of the principle of equality before the law, weakening European efforts to establish a coherent digital single market. This could lead to infringement proceedings against Spain, led by the European Commission, for failing to comply with the harmonisation requirements set out in the Community framework.
Penalties for non-compliance:
In similar cases, the European Commission has sanctioned Member States for failing to adapt their national legislation to European directives. Spain could face economic fines or budgetary restrictions on funds for technological innovation if this regulatory exclusion persists.
Consolidation of repetitive arguments The lack of an effective sanctioning regime for PPPs acts as a “white letter” to act without due diligence in the AI area, which has two main consequences:
Erosion of citizen confidence: The perception that public administrations are exempt from sanctions fuels mistrust in government institutions and fosters a sense of inequality with the private sector, subject to strict financial fines.
Operational risks: Public officials could prioritize ethics in technological implementations, exacerbating problems such as discriminatory biases or misjudged automated decisions affecting fundamental rights.
If, as previously argued, government algorithms may exhibit discriminatory bias and the administration is suffering from a ‘systemic crisis’ in its digital infrastructure, the absence of financial penalties for the misuse of AI could have even more serious consequences. The possibility that a ministry or city council might deploy a “high-risk” AI system without the required safeguards—or even use a prohibited AI practice—with a warning as the sole consequence would not only place the private sector at an unfair disadvantage, but also undermine public confidence in the fairness and accountability of the State.
The lack of an effective sanctioning regime for PPPs could be interpreted as a ‘blank check’ to act without due diligence in the AI area. If public officials perceive that errors or bad practices in the use of artificial intelligence do not have economic consequences, the incentive to prioritize ethics, transparency and accountability could be significantly reduced. This situation is particularly worrying given the already existing resistance to change and mistrust towards automated systems manifested by some officials.
As discussed in the first part, the justifications for this exclusion, based on the ‘cash unit’ or the nature of the ‘general interest’, are weak in the face of the principles of equality and responsibility. Moreover, in a sensitive area such as AI, where errors can affect Fundamental Rights, this regulatory asymmetry could have a direct and detrimental impact on people’s lives, exacerbating the social consequences of the “algorithmic exclusion” already observed.
The experience with excluding fines for public administrations in the Organic Law on Data Protection (LOPD) and later in the GDPR offers relevant lessons. As noted above, this practice has been criticized for creating “islands of impunity” and has generated a perception of double measuring rod. The absence of economic sanctions has been able to diminish deterrent force to the actions of the Spanish Data Protection Agency (AEPD). It is foreseeable that the Spanish Agency for Supervision of the AI (AESIA) will face a similar situation if the exclusion of sanctions is maintained, limiting its ability to “effectively ficsate” the Administrations.
In view of this, it is crucial to reconsider the exclusion of PPPs from the sanctioning regime in the AI Act. As suggested by various associations and experts, it is essential to eliminate or at least significantly narrow this exemption. Establishing equitable accountability mechanisms is essential to ensure a responsible and ethical use of artificial intelligence in the public sector. This could include:
* Allow economic sanctions for PPPs, perhaps with reduced ceilings and allocating funds to ethical AI projects or social purposes.
* Implement effective non-pecuniary sanctions, such as temporary suspension of AI systems, publication of infringement reports or withholding of funds.
Strengthen independent oversight of public AI by AESIA, giving it full control and audit powers.
* Promote transparency and citizen participation in the development and use of AI by PPPs.
In short, the successful and ethical implementation of artificial intelligence in the Spanish public administration requires a coherent and robust regulatory framework that requires all actors, both public and private, to be held accountable for their actions. Maintaining an exemption from sanctions for public administrations, in the context of existing systemic weaknesses, could perpetuate citizen distrust and undermine the legitimacy of the law itself and the rule of law. It is essential that equitable accountability mechanisms be established to ensure that artificial intelligence in the public sector is adopted in a transparent, ethical and consistent manner in accordance with the principles of equality before the law.
