Regulating Artificial Intelligence

Advances in technology have always required new laws and regulations to protect human rights, ensure health and safety, and preserve market efficiency. But legislators are often slow to react to new technologies. It took 60 years from the introduction of the Ford Model T for the US to federally mandate seatbelts in cars, and a further 16 years before it became compulsory to actually wear them.

Since OpenAI’s ChatGPT was made available for public use in late 2022, the problem of how to regulate AI has been thrust to the fore of mainstream media attention. UK Prime Minister Rishi Sunak has said that he wants the UK to be “the home of global AI safety regulation,” and the European Union’s proposed AI Act seeks to regulate the use and development of AI across the Member States.

During our initial research into AI and the law, we have identified two main intersection points. The first is how AI interacts with existing legal frameworks in IP, data privacy, or human rights. The second concerns the work that lawyers are doing in preparation for proposed regulation in the EU, US and UK.

There is currently little regulation specific to AI, and, given that use of AI in businesses is increasing, there is a huge amount of work for lawyers to do in this area.

During our research, the lawyers we spoke to discussed at length the advisory work they were seeing on regulation and clients’ use of AI. One interviewee said that “our clients are bombarding us with questions” about AI, “like, what are the guidelines? What policies should we have?”

There are knotty, novel, and highly specific issues intrinsic to AI, and practitioners who have a deeper familiarity with these issues are best placed to advise and educate clients. One lawyer told us that a part of their practice was “to provide an understanding of the technology” for the firm’s clients. Another said that “some of it is just education: what is AI and what should I be worried about?”

One novel issue raised by AI is the concept of explainability: most AI models “have ‘black box’ elements, meaning we are not able to understand how they reach a conclusion.” Simply put, we usually cannot know ‘why’ an AI model responds to inputs in the way it does.

Nonetheless, AI faces “a lot of encouragement from regulators to be ‘explainable’.” Companies using AI to automate data analysis and decision-making, such as sifting candidates’ CVs or analysing investment grant applications, will need to be aware of this need for explainability. Our interviewees told us that some of their clients are seeking advice about creating ‘explainability statements’.

This kind of future-proofing and getting companies ready for regulation is keeping the AI lawyers we spoke to exceptionally busy.

One source noted that “a lot of billable work is about oversight and governance.” Businesses need to be prepared for their employees to start using AI models in their work, and they are seeking their lawyers’ help to develop internal frameworks and policies for how to use AI.

One interviewee informs us that they are helping clients to establish “responsible AI governance committees,” and another states that “emerging areas of advice” include “broader governance of AI, internal policies, reporting lines, and potentially committees dealing with ethical questions” around the use of AI.

There have been few disputes or regulatory investigations concerning the use of AI; at least, so far. Whether this continues as AI gains mass adoption will depend on how successfully businesses can implement these kinds of guidelines, and how compliant they end up being with regulation.

Given that the EU’s AI Act isn’t expected to come into effect until 2025, the uncertainty around uses of AI in business will continue for some time yet. Lawyers advising on the use of AI are likely to be in high demand for the foreseeable future.

The legal AI market is growing, and lawyers and law firms are playing catch-up. Those who use AI, create AI or want to implement AI will increasingly need to seek advice from AI specialist lawyers and firms.

Law firms with expertise in AI law are invited to send submissions to our Artificial Intelligence – Global Market Leaders category for Chambers Global in Spring 2024.