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THE LEGAL IMPLICATIONS OF AI IN SOFTWARE DEVELOPMENT

In today’s evolving technological landscape, Artificial Intelligence (AI) stands out as a revolutionary force, reshaping industries and redefining the boundaries of what’s possible. For software companies, AI offers unprecedented opportunities for innovation. However, with these opportunities come intricate legal challenges that every software company must be prepared to navigate.

Understanding AI’s Role in Software

AI, with its algorithms and computational models, has permeated various facets of software development, from predictive analytics to chatbots. As AI systems grow in complexity, they usher in legal concerns in areas like data privacy, intellectual property, and liability.

Data Privacy and the European Landscape

With AI’s heavy reliance on data, the European Union’s General Data Protection Regulation (GDPR) has become even more significant. Introduced in 2018, GDPR emphasises:

  • Transparent data collection and processing;
  • Robust security measures against potential breaches; and
  • Upholding data subject rights, including access, rectification, and erasure.

Furthermore, the European Commission’s White Paper on Artificial Intelligence proposes stricter regulations for high-risk AI systems, focusing on transparency, accountability, and ensuring citizens’ rights.

Intellectual Property Challenges in the AI Era

The European Patent Office (EPO) has provided guidelines on patenting AI technologies, indicating that while AI models can be patented, the inventions they produce cannot. Software companies must:

  • Ensure that IP ownership agreements are clear and comprehensive. Specify who owns the rights to AI-generated content or.
  • Conduct regular IP audits to identify and protect AI-generated assets.
  • Consider flexible licensing strategies for AI-generated content. This can provide additional revenue streams and foster collaborations.
  • If using open-source AI tools, be aware of the licensing terms. Some licenses may have conditions that could affect the commercialisation of AI-generated content or inventions.
  • Regularly consult with legal experts specialising in AI and IP to ensure compliance. As AI-related IP laws evolve, it’s crucial to stay updated – we invite you to book a free 20-minute consultation with our dedicated lawyers to clear your doubts.

Liability and the European Directive

If an AI system malfunctions or causes harm, who is to blame? The software developer, the end-user, or the AI system? Establishing liability can be complex. The European Parliament has been considering updates to the Product Liability Directive to address the challenges posed by AI and other emerging technologies, including determining responsibility if an AI system causes harm. Therefore, it is important to stay informed about emerging regulations and standards related to AI accountability.

Under the current legal framework, to mitigate risks, software companies should:

  • Clearly outline terms of use and potential risks associated with AI systems; and
  • Implement rigorous testing and quality assurance processes for AI solutions.

The European AI Act: A New Horizon for Trustworthy AI

The European Commission has recently proposed a comprehensive approach to ensure that artificial intelligence (AI) used within the EU is trustworthy and aligns with European values. This approach, known as the AI Act, aims to foster the development and deployment of AI technologies that are safe, transparent, ethical, unbiased, and remain under human control. The Act categorises AI systems based on their risk levels.

The AI Act emphasises the importance of continuous assessment and monitoring throughout the lifecycle of high-risk AI systems. It mandates a conformity assessment, compliance with AI requirements, registration in an EU database, and the acquisition of a CE marking before such systems can be placed on the market.

Although, the AI Act is yet to be adopted, for businesses and individuals interested in AI developments in Europe, it’s crucial to stay informed about its guidelines and implications not to fall by the wayside.

Navigating the European Legal Landscape with Logan & Partners

At Logan & Partners, we understand the intricacies of technology law. Our expertise spans both domestic and international legal landscapes, ensuring our clients are well-equipped to navigate the complexities of AI and other emerging technologies.

Are you a software company exploring the vast potentials of AI? Don’t let legal uncertainties hinder your innovation. Book a free 20-minute consultation with us today and ensure your AI endeavours are legally sound and compliant.

| Image by macrovector on Freepik | 

blank Anna Levitina

Senior Associate

anna.levitina@loganpartners.com

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