AI: Control it or be Controlled


Governments and industry recognize that Artificial Intelligence (AI) is opening up transformational opportunities in all areas of human activity. At the same time, it poses unique risks: ethical, legal and regulatory challenges. These issues need to be carefully addressed in Hungary as well. The scope, speed and nature of the response will have a significant impact on the success of AI.

Dóra Petrányi, Partner, CEE Managing Director, Head of TMT, CMS Budapest.

When AI Fails to Perform

One of the most important legal issues raised by the increasing use of AI technology is dealing with the damage caused by its potential failure. As a result, we will likely see an increase in AI-related disputes over the next decade. For example, a driverless car may hit a pedestrian, a drone partially operated by a pilot may crash and cause damage, AI software may diagnose the wrong medical treatment. As there are many parties involved in the operation of an AI system (data provider, designer, manufacturer, programmer, developer, user and the AI system itself), liability is difficult to establish when something goes wrong.

Ownership of the Creations of AI

Another challenge is that the current intellectual property laws are not well suited to deal with the situation where an AI creates potential intangible assets. Patent law generally considers the inventor as the first owner of the invention. If an autonomous AI generates an invention, there is no legal owner; the AI technology cannot own the invention, and in many cases tangible assets can only arise if there is a human creator. At this stage of development, it may not be possible to give autonomous AI the status of a legal person. Humans should have the ethical duty to take responsibility for any autonomous AI technology they commission, deploy or use.

GDPR Compliance

Data protection has taken center stage this year with the EU General Data Protection Regulation (GDPR). The use of AI solutions may involve the processing of personal data and engage someone’s obligations as a data controller. As in the case of determining the liability of AI, it is difficult to determine who is the controller of the personal data processed by the AI (data provider, designer, manufacturer, programmer, developer, user or AI system itself). The data controller will need to bear in mind the data protection principles set out in the GDPR, all of which are likely to be relevant to data collection through AI, analyzing and potentially acting on the results.

Márton Domokos, Senior Counsel, TMT, CMS Budapest

On the Radar of Competition Authorities

Competition authorities in Europe and beyond are beginning to pay closer attention to the effects of AI and big data on competition. The U.K.’s Competition and Markets Authority is currently establishing a new Data Unit across different disciplines to increase its understanding of the impact that data, machine learning and other algorithms have on markets and people. In May 2016, the German Federal Cartel Office and the French antitrust authority published a joint report on the theories of harm connected to big data.

Rise of the Internal AI Ethics Board

To address the legal concerns which arise, organizations may appoint an internal AI ethics board to provide thought leadership and guidance on how to reach and exploit AI technology and associated data. For example, Microsoft established its AI and Ethics in Engineering and Research Committee. Among other steps, AETHER is investing in strategies and tools for detecting and addressing bias in AI systems and implementing new requirements established by GDPR.

The Artificial Intelligence Coalition

The fact that AI can be no longer pushed aside on a national level of decision making is illustrated by Hungary’s new Artificial Intelligence Coalition, which was formed in October and comprises more than 70 Hungarian and international companies, universities, scientific workshops, and professional and public administration organizations, including CMS.

Its purpose is to create a cooperation platform, determine the framework of R&D and bring Hungary to the forefront of the utilization of AI. The coalition is working as part of the government’s Digital Welfare Program. Its members are involved in the development of the Hungarian AI strategy – in particular, in the analysis of social and economic impacts associated with the spread of AI, and the numerous, sometimes entirely new, legal issues.

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