AI and the Law: Striking a Balance Between Innovation and Regulation
The legal landscape is complex, with words and rhetoric having significant influences in the business environment and individual lives. As artificial intelligence (AI) rapidly transforms industries, adapting the legal system to accommodate these advancements and navigate the inherent risks has become a paramount task. Early implementations of AI in law revealed challenges, including the generation of inaccurate information. The legal community is now looking to build oversight directly into the system.
A recent panel at the IIA event in Davos explored these critical issues in depth, highlighting the discussions involving key stakeholders.
Gabriele Mazzini, the AI Act Team Leader for the European Commission, emphasized that the legislation aims to foster innovation and responsible adoption by enhancing safety. Pablo Arredondo, VP of CoCounsel at Thomson Reuters, stressed the importance of tools that enable oversight, such as transparent sourcing. Julia Apostle, a partner at Orrick specializing in AI, data, and privacy regulations, noted that businesses are actively seeking clarity on the rules for AI implementation. She pointed out that regulation isn’t going to be a one-size-fits-all solution, suggesting that companies use greater frameworks that can be challenging for small businesses because legislation is coming from many sources.
Mazzini discussed various legal frameworks and emphasized the importance of their implementation. He mentioned the role of “sandboxes,” which should provide SMEs with better access.
Crafting a Response to AI Regulation
Arredondo shared insights into crafting a response to AI regulation in law, also highlighting AI model advancement. “If you understand law and you worked as a lawyer, I think that could help,” he said. “It doesn’t do everything. And I think another interesting aspect of this now is, when we started out in 2023, GPT-4 was essentially the only game in town… And now what we’re seeing is that there are open source models that are coming out that are quite cutting edge, including approaches that OpenAI just released late last year.”
Apostle also referenced the importance of compliance tools.
“There is scope, obviously, for compliance tools. That’s going to be something that everybody will need to think about: how can we actually build tools that help us with these tasks? And identifying the risk is a big one, right? Because it’s one thing to say: here are your risk categories, but then you actually have to find how they play out in the product.”
Embracing Regulators and Open Source Models
Mazzini clarified that businesses shouldn’t be overly concerned about overly broad regulations. He explained that the European legislation aims to correct any miscommunication, or misunderstanding about the law.
Debate also revolved around open source models, with Mazzini explaining the rules for all foundation models. Provisions surrounding copyright protection are applicable to these models.
Apostle brought attention to regulation changes, specifically the inclusion of software into legislation. She asked how enforcement of open source software will look, as she said it’s a challenge for regulators.
“It’s going to be a very interesting development and also, I think, quite a challenge for regulators, as though things weren’t hard enough.”
Collaborating with Stakeholders
In response to questions about partnerships, Apostle suggested that partnering would allow law firms to evolve in smarter ways.
Arredondo suggested the activity of a modern firm would be a mix: “I’ve seen fantastic in-house solutions from firms for certain things… But I think it’ll be a mix, right, where you’re going to have some things you completely outsource, mostly either because of content, or a bunch of nuances, some things that perhaps you do partner and kind of develop, and some things that somebody just sort of comes up with, and it ends up being a really useful way to do something inside the firm.”
Mazzini explained the influence of the European laws on non-EU companies.
Enabling Business and Future Outlook
Mazzini closed by discussing the importance of enabling business and innovation in Europe. Apostle and Arredondo suggested that regulators and companies can be on the same side of innovation. This provides businesses with a lot to consider about the rules for AI applications, and how to make these laws work for their businesses.
