PE teams sign LOIs on targets with AI-native or AI-powered products without knowing if any of it qualifies as "high-risk" under the EU AI Act, or if the target is a “provider” (heavy obligations) or a “deployer” (light ones).
Legal only looks after exclusivity, when the price is already set. The high-risk deadline was postponed to 2 December 2027, but it wasn’t scrapped. Any target you buy today will have to comply within your hold period. So, specialist AI risk DD support becomes essential.
Belstark sits where most DD teams split: 1) deal execution, 2) AI and technology, and 3) regulation, risk, and compliance. We know how a deal runs from LOI to exit, and we read a target’s tech stack and its regulatory exposure at the same time, not in separate workstreams. We inventory every AI feature in the target from public sources and management Q&A. We classify each one against the Act’s risk tiers and clarify the target’s role, flagging where fine-tuning or rebranding a third-party model turns it from a deployer into a provider. We then size the risk: what the classification means for cost, timeline and value against the December 2027 deadline, which falls inside your hold period. You get an IC-ready AI risk memo: every AI feature classified, red flags ranked by deal impact, the cost and value implications for your deal model, the questions to put to management, and the protections to ask your counsel for in the SPA. All before you sign.
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