Incorporating artificial intelligence (AI) in business is becoming more widespread globally. A survey of Global 500 companies found that leaders choosing to invest in AI and automation business tools and software solutions expect to see significant growth within the next few years. According to PwC’s Global Artificial Intelligence Study, we can expect to see 45% of the $15.7 trillion in global economic gains by 2030 as the result of AI and automation product enhancements that are driving consumer demand across the manufacturing industry. This includes foreseeing unexpected machine and equipment breakdowns, identifying yield losses and locating detractors. Over one-third of companies are now using AI, with another 42% investigating its potential to enhance business operations. Among major corporations, like those in the Fortune 500, the adoption rate is as high as 99%.
AI offers significant advantages, such as reducing the load of mundane tasks, improving efficiency, and enabling more tailored services for businesses and consumers. However, its extensive use also introduces risks, particularly if adequate protective measures are not in place.
Therefore, AI is increasingly coming under scrutiny of legislative and regulatory bodies across the world, including in the US at various government levels and in the EU, where the EU AI Act is poised to set a leading standard for AI regulation with its risk-centric approach. Legislation is also being proposed in specific sectors, like HR Tech and Insurance, to govern AI and automation.
Although legislation has not caught up to the rapid advance of AI technology, it is crucial to remember that AI technologies are still subject to existing laws, and the rise of automation doesn’t exempt companies from legal compliance.
Regulatory authorities, such as the Equal Employment Opportunity Commission (EEOC), Financial Conduct Authority (FCA), Federal Trade Commission (FTC), and Consumer Financial Protection Bureau (CFPB), have emphasized this point. There have been many legal actions against firms that implemented AI without suitable safeguards, leading to violations of existing legislation.
There have been many legal challenges to those companies using AI systems that rely on biometrics. The existing biometric and data protection laws are being used to legally challenge the development of these systems and the data used to train them. Some of the key technology issues in these lawsuits include:
In summary, AI applications are increasingly scrutinized for compliance with biometric and data protection laws, particularly concerning privacy, consent, and data handling practices.
As an example:
Clearview AI, a company that creates a facial image database from internet and social media images, has faced legal actions in various countries for its practices. The company didn’t inform individuals about collecting their facial images nor disclosed any storage period, breaching data protection laws. In Italy, the Garante per la Protezione dei Dati Personali imposed a €20 million fine under GDPR, prohibiting Clearview AI from processing biometric data of Italians and ordering the deletion of all such existing data. Similarly, in Illinois, USA, the American Civil Liberties Union took legal action against Clearview AI for violating the state’s Biometric Information Privacy Act (BIPA).
Other areas for legal challenges include Bias, Copyright Violation, and Health care analysis. In the case of copyright:
Courts and government bodies are getting tougher on the misuse of AI according to existing laws. They’re highlighting the importance of continuously managing risks and following rules when using this technology.
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