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From Regulation to Implementation: A Critical Evaluation of LLM-Assisted Regulatory Compliance in Industry

LLM compliance generation behaves differently under vague and strict schemas: vague artifacts need richer context, while rigid formats can stay consistent yet hallucinate.

arXiv
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Source Summary

The study compares LLM-generated compliance artifacts with manually created schemas. **DPIAs**, which lack a standardized format, needed higher-context prompts for consistency and completeness; stricter **Digital Battery Passport** formatting stayed consistent across prompt contexts.

Practical Implication

For compliance agents, tune context and validation to the artifact rather than applying one prompt recipe. Supply richer regulatory and system context for underspecified documents, and add field-level source checks for rigid schemas.

Agent-Ready Context
The study compares LLM-generated compliance artifacts with manually created schemas. **DPIAs**, which lack a standardized format, needed higher-context prompts for consistency and completeness; stricter **Digital Battery Passport** formatting stayed consistent across prompt contexts.

For compliance agents, tune context and validation to the artifact rather than applying one prompt recipe. Supply richer regulatory and system context for underspecified documents, and add field-level source checks for rigid schemas.

Consistency is not correctness: stricter formatting produced more stable outputs but could increase **hallucinations**. The material does not provide model-level results or enough detail to generalize beyond the two artifact types studied.
Context Map
industrydata#enterprise#context-engineering#agent-reliability
Uncertainty
Consistency is not correctness: stricter formatting produced more stable outputs but could increase **hallucinations**. The material does not provide model-level results or enough detail to generalize beyond the two artifact types studied.