On April 28, 2022, Covington convened experts across our practice groups for the Covington Robotics Forum, which explored recent developments and forecasts relevant to industries affected by robotics. Sam Jungyun Choi, Associate in Covington’s Technology Regulatory Group, and Anna Oberschelp, Associate in Covington’s Data Privacy & Cybersecurity Practice Group, discussed global regulatory trends that
European Commission Proposes New Artificial Intelligence Regulation
In April 2021, the European Commission released its proposed Regulation Laying Down Harmonized Rules on Artificial Intelligence (the “Regulation”), which would establish rules on the development, placing on the market, and use of artificial intelligence systems (“AI systems”) across the EU. The proposal, comprising 85 articles and nine annexes, is part of a wider package of Commission initiatives aimed at positioning the EU as a world leader in trustworthy and ethical AI and technological innovation.
The Commission’s objectives with the Regulation are twofold: to promote the development of AI technologies and harness their potential benefits, while also protecting individuals against potential threats to their health, safety, and fundamental rights posed by AI systems. To that end, the Commission proposal focuses primarily on AI systems identified as “high-risk,” but also prohibits three AI practices and imposes transparency obligations on providers of certain non-high-risk AI systems as well. Notably, it would impose significant administrative costs on high-risk AI systems of around 10 percent of the underlying value, based on compliance, oversight, and verification costs. This blog highlights several key aspects of the proposal.
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Strategic Technology Transactions in Europe – Considerations for U.S. and Global Companies
Over the last year we have seen increasing interest from our global client base in investing in strategic, transformational technology transactions with European counterparties. These transactions often facilitate access to key technologies, geographies and, of course, data. In this note we set out 6 key points to keep in mind when planning, negotiating and executing these types of transactions across Europe.
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European Commission Launches Consultation on Initiative to Fight Child Sexual Abuse
On February 11, 2021, the European Commission launched a public consultation on its initiative to fight child sexual abuse online (the “Initiative”), which aims to impose obligations on online service providers to detect child sexual abuse online and to report it to public authorities. The consultation is part of the data collection activities announced in the Initiative’s inception impact assessment issued in December last year. The consultation runs until April 15, 2021, and the Commission intends to propose the necessary legislation by the end of the second quarter of 2021.
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AI Update: European Commission Conducts Open Consultation on the European Health Data Space Initiative
On December 23, 2020, the European Commission (the “Commission”) published its inception impact assessment (“Inception Impact Assessment”) of policy options for establishing a European Health Data Space (“EHDS”). The Inception Impact Assessment is open for consultation until February 3, 2021, encouraging “citizens and stakeholders” to “provide views on the Commission’s understanding of the current situation, problem and possible solutions”.
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AI Update: The European Commission publishes a proposal for a Regulation on European Data Governance (the Data Governance Act)
On 25 November 2020, the European Commission published a proposal for a Regulation on European Data Governance (“Data Governance Act”). The proposed Act aims to facilitate data sharing across the EU and between sectors, and is one of the deliverables included in the European Strategy for Data, adopted in February 2020. (See our previous blog here for a summary of the Commission’s European Strategy for Data.) The press release accompanying the proposed Act states that more specific proposals on European data spaces are expected to follow in 2021, and will be complemented by a Data Act to foster business-to-business and business-to-government data sharing.
The proposed Data Governance Act sets out rules relating to the following:
- Conditions for reuse of public sector data that is subject to existing protections, such as commercial confidentiality, intellectual property, or data protection;
- Obligations on “providers of data sharing services,” defined as entities that provide various types of data intermediary services;
- Introduction of the concept of “data altruism” and the possibility for organisations to register as a “Data Altruism Organisation recognised in the Union”; and
- Establishment of a “European Data Innovation Board,” a new formal expert group chaired by the Commission.
AI Update: EU High-Level Working Group Publishes Self Assessment for Trustworthy AI
On July 17, 2020, the High-Level Expert Group on Artificial Intelligence set up by the European Commission (“AI HLEG”) published The Assessment List for Trustworthy Artificial Intelligence (“Assessment List”). The purpose of the Assessment List is to help companies identify the risks of AI systems they develop, deploy or procure, and implement appropriate measures to mitigate those risks.
The Assessment List is not mandatory, and there isn’t yet a self-certification scheme or other formal framework built around it that would enable companies to signal their adherence to it. The AI HLEG notes that the Assessment List should be used flexibly; organizations can add or ignore elements as they see fit, taking into consideration the sector in which they operate. As we’ve discussed in our previous blog post here, the European Commission is currently developing policies and legislative proposals relating to trustworthy AI, and it is possible that the Assessment List may influence the Commission’s thinking on how organizations should operationalize requirements relating to this topic.
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IoT Update: The European Commission launches an antitrust sector inquiry into the sector of Internet of Things for consumer-related devices and services
On 16 July 2020, the European Commission (“Commission”) announced that it has launched an antitrust sector inquiry into “consumer-related products and services that are connected to a network and can be controlled at a distance, for example via a voice assistant or mobile device.”
Commission Executive Vice President and Competition Commissioner Vestager said that “[t]he sector inquiry will cover products such as wearable devices (e.g. smart watches or fitness trackers) and connected consumer devices used in the smart home context, such as fridges, washing machines, smart TVs, smart speakers and lighting systems. The sector inquiry will also collect information about the services available via smart devices, such as music and video streaming services and about the voice assistants used to access them.” Connected cars are outside of the scope of the inquiry.
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French CNIL Publishes Paper on Algorithmic Discrimination
On June 2, 2020, the French Supervisory Authority (“CNIL”) published a paper on algorithmic discrimination prepared by the French independent administrative authority known as “Défenseur des droits”. The paper is divided into two parts: the first part discusses how algorithms can lead to discriminatory outcomes, and the second part includes recommendations on how to identify and minimize algorithmic biases. This paper follows from a 2017 paper published by the CNIL on “Ethical Issues of Algorithms and Artificial Intelligence”.
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AI Update: European Commission’s Plans for AI and Data: Focus on Digital Health (Part 4 of 4)
In this final instalment of our series of blogs on the European Commission’s plans for AI and data, announced on 19 February 2020, we discuss some potential effects on companies in the digital health sector. As discussed in our previous blog posts (here, here and here), the papers published by the European Commission cover broad concepts and apply generally — but, in places, they specifically mention healthcare and medical devices.
The Commission recognizes the important role that AI and big data analysis can play in improving healthcare, but also notes the specific risks that could arise given the effects that such new technologies may have on individuals’ health, safety, and fundamental rights. The Commission also notes that existing EU legislation already affords a high level of protection for individuals, including through medical devices laws and data protection laws. The Commission’s proposals therefore focus on addressing the gap between these existing rules and the residual risks that remain in respect of new technologies. Note that the Commission’s proposals in the White Paper on AI are open for public consultation until 19 May 2020.