AI Liability Act

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Over the past few weeks we have seem a number of new Artificial Intelligence (AI) Acts or Laws, either being proposed or are at an advanced stage of enactment. One of these is the EU AI Liability Act (also), and is supposed be be enacted and work hand-in-hand with the EU AI Act.

There are different view or focus perspectives between these two EU AI acts. For the EU AI Act, the focus is from the technical perspective and those who develop AI solutions. On the other side of things is the EU AI Liability Act whose perspective is from the end-user/consumer point.

The aim of the EU AI Liability Act is to create a framework for trust in AI technology, and when a person has been harmed by the use of the AI, provides a structure to claim compensation. Just like other EU laws to protect the consumers from defective or harmful products, the AI Liability Act looks to do similar for when a person is harmed in some way by the use or application of AI.

Most of the examples given for how AI might harm a person includes the use of robotics, drones, and when AI is used in the recruitment process, where is automatically selects a candidate based on the AI algorithms. Some other examples include data loss from tech products or caused by tech products, smart-home systems, cyber security, products where people are selected or excluded based on algorithms.

Harm can be difficult to define, and although some attempt has been done to define this in the Act, additional work is needed to by the good people refining the Act, to provide clarifications on this and how its definition can evolve post enactment to ensure additional scenarios can be included without the need for updates to the Act, which can be a lengthy process. A similar task is being performed on the list of high-risk AI in the EU AI Act, where they are proposing to maintain a webpages listing such.

Vice-president for values and transparency, Věra Jourová, said that for AI tech to thrive in the EU, it is important for people to trust digital innovation. She added that the new proposals would give customers “tools for remedies in case of damage caused by AI so that they have the same level of protection as with traditional technologies”

Didier Reynders, the EU’s justice commissioner says, “The new rules apply when a product that functions thanks to AI technology causes damage and that this damage is the result of an error made by manufacturers, developers or users of this technology.

The EU defines “an error” in this case to include not just mistakes in how the A.I. is crafted, trained, deployed, or functions, but also if the “error” is the company failing to comply with a lot of the process and governance requirements stipulated in the bloc’s new A.I. Act. The new liability rules say that if an organization has not complied with their “duty of care” under the new A.I. Act—such as failing to conduct appropriate risk assessments, testing, and monitoring—and a liability claim later arises, there will be a presumption that the A.I. was at fault. This creates an additional way of forcing compliance with the EU AI Act.

The EU Liability Act says that a court can now order a company using a high-risk A.I. system to turn over evidence of how the software works. A balancing test will be applied to ensure that trade secrets and other confidential information is not needlessly disclosed. The EU warns that if a company or organization fails to comply with a court-ordered disclosure, the courts will be free to presume the entity using the A.I. software is liable.

The EU Liability Act will go through some changes and refinement with the aim for it to be enacted at the same time as the EU AI Act. How long will this process that is a little up in the air, considering the EU AI Act should have been adopted by now and we could be in the 2 year process for enactment. But the EU AI Act is still working its way through the different groups in the EU. There has been some indications these might conclude in 2023, but lets wait and see. If the EU Liability Act is only starting the process now, there could be some additional details if the EU wants both Acts to be effective at the same time.