AI literacy: AI literacy is the skills, knowledge and understanding that let people use AI systems in an informed way and be aware of their opportunities, risks and possible harms. Article 4 has applied since 2 February 2025; the AI Digital Omnibus softened it to supporting staff AI literacy.
In plain words
Make sure the people who use AI in your business know what it can and can't do, and your house rules for it.
What it means for a small business
A short briefing for staff who use AI at work is a sensible, proportionate step: what the tools are for, where they make mistakes, what never to put into them, and who to ask. Note the date you did it.
Example
ExampleA shop owner spends 15 minutes with two staff: the AI writes first drafts of replies, a person checks anything about money, and customer data is never pasted into personal AI accounts.
Source
Regulation (EU) 2024/1689, the AI Act, Article 3(56) and Article 4, on EUR-Lex. This page explains the term in plain words; it is not legal advice.