The EU AI Act is the world's first comprehensive AI regulation aimed at promoting responsible AI development and deployment in the European Union. It applies to a broad range of stakeholders, including providers, deployers, importers, distributors, product manufacturers, and authorized representatives, who develop and use AI systems within the EU market. The regulation categorizes AI systems into four risk categories: minimal, limited, high, and unacceptable, with increasing levels of compliance requirements. Most teams will only need to ensure transparency and documentation for their AI systems, while high-risk systems require comprehensive monitoring, risk management, and human oversight. The Act also regulates general-purpose AI models, which are expected to be subject to guidelines that will be finalized in August 2025. Observability is key to compliance, as it enables continuous monitoring across multiple dimensions, including performance tracking, data quality assessment, and bias detection. Organizations that fail to comply face severe penalties, including fines of up to €35 million or 7% of global revenue. By investing in observability now, developers can build trust with users while taking the first step towards regulatory requirements.