FMs are versatile AI systems with the potential to revolutionise various sectors, from information access to healthcare. The CMA’s report, published today, outlines a set of guiding principles aimed at safeguarding consumer protection and fostering healthy competition within this burgeoning industry.

Foundation models – known for their adaptability to diverse applications – have witnessed rapid adoption across various user platforms, including familiar names like ChatGPT and Office 365 Copilot. These AI systems possess the power to drive innovation and stimulate economic growth, promising transformative changes across sectors and industries.

Sarah Cardell, CEO of the CMA, emphasised the urgency of proactive intervention in the AI:

“The speed at which AI is becoming part of everyday life for people and businesses is dramatic. There is real potential for this technology to turbocharge productivity and make millions of everyday tasks easier – but we can’t take a positive future for granted.

That’s why we have today proposed these new principles and launched a broad programme of engagement to help ensure the development and use of foundation models evolves in a way that promotes competition and protects consumers.

While I hope that our collaborative approach will help realise the maximum potential of this new technology, we are ready to intervene where necessary.”

Research from Earlybird reveals that Britain houses the largest number of AI startups in Europe. The CMA’s report underscores the immense benefits that can accrue if the development and use of FMs are managed effectively.

These advantages include the emergence of superior products and services, enhanced access to information, breakthroughs in science and healthcare, and even lower prices for consumers. Additionally, a vibrant FM market could open doors for a wider range of businesses to compete successfully, challenging established market leaders. This competition and innovation, in turn, could boost the overall economy, fostering increased productivity and economic growth.

Claire Trachet, tech industry expert and CEO of business advisory Trachet, said:

“With the [UK-hosted] global AI Safety Summit around the corner, the announcement of these principles shows the public and investors that the UK is committed to regulating AI safely. To continue this momentum, it’s important for the UK to strike a balance in creating effective regulation without stifling growing innovation and investment. 

Ensuring that regulation is both well-designed and effective will help attract and maintain investment in the UK by creating a stable, secure, and trustworthy business environment that appeals to domestic and international investors.” 

The CMA’s report also sounds a cautionary note. It highlights the potential risks if competition remains weak or if developers neglect consumer protection regulations. Such lapses could expose individuals and businesses to significant levels of false information and AI-driven fraud. In the long run, a handful of dominant firms might exploit FMs to consolidate market power, offering subpar products or services at exorbitant prices.

While the scope of the CMA’s initial review focused primarily on competition and consumer protection concerns, it acknowledges that other important questions related to FMs, such as copyright, intellectual property, online safety, data protection, and security, warrant further examination.

Sridhar Iyengar, Managing Director of Zoho Europe, commented:

“The safe development of AI has been a central focus of UK policy and will continue to play a significant role in the UK’s ambitions of leading the global AI race. While there is public concern over the trustworthiness of AI, we shouldn’t lose sight of the business benefits that it provides, such as forecasting and improved data analysis, and work towards a solution.

Collaboration between businesses, government, academia and industry experts is crucial to strike a balance between safe regulations and guidance that can lead to the positive development and use of innovative business AI tools.

AI is going to move forward with or without the UK, so it’s best to take the lead on research and development to ensure its safe evolution.”

The proposed guiding principles, unveiled by the CMA, aim to steer the ongoing development and use of FMs, ensuring that people, businesses, and the economy reap the full benefits of innovation and growth. Drawing inspiration from the evolution of other technology markets, these principles seek to guide FM developers and deployers in the following key areas:

• Accountability: Developers and deployers are accountable for the outputs provided to consumers.
• Access: Ensuring ongoing access to essential inputs without unnecessary restrictions.
• Diversity: Encouraging a sustained diversity of business models, including both open and closed approaches.
• Choice: Providing businesses with sufficient choices to determine how to utilize FMs effectively.
• Flexibility: Allowing the flexibility to switch between or use multiple FMs as needed.
• Fairness: Prohibiting anti-competitive conduct, including self-preferencing, tying, or bundling.
• Transparency: Offering consumers and businesses information about the risks and limitations of FM-generated content to enable informed choices.

Over the next few months, the CMA plans to engage extensively with a diverse range of stakeholders both within the UK and internationally to further develop these principles. This collaborative effort aims to support the positive growth of FM markets, fostering effective competition and consumer protection.

Gareth Mills, Partner at law firm Charles Russell Speechlys, said:

“The principles themselves are clearly aimed at facilitating a dynamic sector with low entry requirements that allows smaller players to compete effectively with more established names, whilst at the same time mitigating against the potential for AI technologies to have adverse consequences for consumers.

The report itself notes that, although the CMA has established a number of core principles, there is still work to do and that stakeholder feedback – both within the UK and internationally – will be required before a formal policy and regulatory position can be definitively established.

As the utilisation of the technologies grows, the extent to which there is any inconsistency between competition objectives and government strategy will be fleshed out.”

An update on the CMA’s progress and the reception of these principles will be published in early 2024, reflecting the authority’s commitment to shaping AI markets in ways that benefit people, businesses, and the UK economy as a whole.

(Photo by JESHOOTS.COM on Unsplash)

See also: UK to pitch AI’s potential for international development at UN

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Now the outlines for the AI Act are known, a debate is beginning to erupt around its possible implications. One camp believes regulations are needed to curb the risks of powerful AI technology, while the other is convinced that regulation will prove pernicious for the European economy. Is it out of the question that safe AI products also bring economic prosperity?

‘Industrial revolution’ without Europe

The EU “prevents the industrial revolution from happening” and portrays itself as “no part of the future world,” Joe Lonsdale told Bloomberg. He regularly appears in the US media around AI topics as an outspoken advocate of the technology. According to him, the technology has the potential to cause a third industrial revolution, and every company should already have implemented it in its organization.

He earned a bachelor’s degree in computer science in 2003. Meanwhile, he co-founded several technology companies, including those that deploy artificial intelligence. He later grew to become a businessman and venture capitalist.

The only question is, are the concerns well-founded? At the very least, caution seems necessary to avoid seeing major AI products disappear from Europe. Sam Altman, a better-known IT figure as CEO of OpenAI, previously spoke out about the possible disappearance of AI companies from Europe if the rules become too hard to apply. He does not plan to pull ChatGPT out of Europe because of the AI law, but he warns here of the possible actions of other companies.

ChatGPT stays

The CEO himself is essentially a strong supporter of security legislation for AI. He advocates for clear security requirements that AI developers must meet before the official release of a new product.

When a major player in the AI field calls for regulation of the technology he is working with, perhaps we as Europe should listen. That is what is happening with the AI Act, through which the EU is trying to be the first in the world to put out a set of rules for artificial intelligence. The EU is a pioneer, but it will also have to discover the pitfalls of a policy in the absence of a working example in the world.

The rules will be continuously tested until they officially come into effect in 2025 by experts who publicly give their opinions on the law. A public testing period which AI developers should also find important, Altman said. The European Union also avoids making up rules from higher up for a field it doesn’t know much about itself. The legislation will come bottom-up by involving companies and developers already actively engaged in AI setting the standards.

Copy off

Although the EU often pronounces that the AI law will be the world’s first regulation of artificial intelligence, other places are tinkering with a legal framework just as much. The United Kingdom, for example, is eager to embrace the technology but also wants certainty about its security. To that end, it immerses itself in the technology and gains early access to DeepMind, OpenAI and Anthropic’s models for research purposes.

However, Britain has no plans to punish companies that do not comply. The country limits itself to a framework of five principles that artificial intelligence should comply with. The choice seems to play to the disadvantage of guaranteed safety of AI products, as the country says it is necessary not to make a mandatory political framework for companies, to attract investment from AI companies in the UK. So secure AI products and economic prosperity do not appear to fit well together according to the country. Wait and see if Europe’s AI law validates that.

(Editor’s note: This article first appeared on Techzine)

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The Global AI Ecosystem platform is developed with support from AI Industry Analytics (AiiA) and Deep Knowledge Group. Designed as a universally accessible space for community interaction, collaboration, content sharing, and knowledge exchange, it has become a vital hub for AI enthusiasts and professionals.

AiiA, in its Global AI Economy Size Assessment report, conducted groundbreaking research showcasing the rapid expansion of the UK’s AI industry.

With over 8,900 companies operating in the sector, the UK AI economy’s valuation of £1.36 trillion underscores its substantial contribution to the national GDP. Approximately 4,100 investment funds are dedicated to AI, with 600 of them based in the UK.

A robust workforce of 500,000 UK-based AI specialists is driving innovation, solidifying the nation’s position in the global AI landscape. This skilled workforce not only bolsters GDP growth but also acts as a safety net against unemployment.

The UK government’s active prioritisation of its national AI agenda is a significant factor in this remarkable growth. Last month, UK Deputy PM Oliver Dowden called AI the most ‘extensive’ industrial revolution yet.

With 280 ongoing projects harnessing AI technology, the UK’s commitment to AI is clear. AI is a major pillar of the country’s national industrial strategy, making the UK one of the most proactive nations in shaping its AI future.

Dmitry Kaminskiy, Founder of AI Industry Analytics (AiiA) and General Partner of Deep Knowledge Group, said:

“Despite an economic downturn and other challenges, the UK stands as an undoubtable, dynamic, and proactive leader in the global AI arena, having surpassed £1.3 trillion in 2023 and projected to reach £2.4 trillion by 2027.

There is no question that AI is poised to be the major driver for economic growth, fuelling the further development of the entire UK DeepTech industry, and creating a cumulative, systemic, positive impact on the full scope of the nation’s integral infrastructure.”

Key cities like London, Cambridge, Manchester, and Edinburgh have emerged as leading AI hubs, fostering collaboration and providing access to essential resources. With nearly 5,000 AI companies in London alone, it competes with entire countries on the global AI stage and solidifies its European leadership status.

AiiA’s estimation of the UK AI economy size used AI algorithms to map the global AI industry, profiling 50,000 companies, 20,000 investors, 2,000 AI leaders, and 2,500 R&D hubs. Building upon previous reports, it conducted the most comprehensive assessment of the Global AI Economy to date, projecting a global AI economy exceeding £27.2 trillion ($34 trillion) by 2027.

The UK’s position as a hub for science, R&D, DeepTech, and AI governance places it in good stead for leveraging AI as a core engine of technological progress and driving economic growth.

(Image Credit: Global AI Ecosystem)

See also: UK government outlines AI Safety Summit plans

Want to learn more about AI and big data from industry leaders? Check out AI & Big Data Expo taking place in Amsterdam, California, and London. The comprehensive event is co-located with Digital Transformation Week.

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Authors: Sean Musch, AI & Partners and Michael Borrelli, AI & Partners

AI – The opportunity and the challenge

AI currently delivers broad societal benefits, from medical advances to mitigating climate change. As an example, an AI technology developed by DeepMind, a UK- based business, can predict the structure of almost every protein known to science. Government frameworks consider the role of regulation in creating the environment for AI to flourish. AI technologies have not yet reached their full potential. Under the right conditions, AI will transform all areas of life and stimulate economies by unleashing innovation and driving productivity, creating new jobs and improving the workplace.

The UK has indicated a requirement to act quickly to continue to lead the international conversation on AI governance and demonstrate the value of our pragmatic, proportionate regulatory approach. In their report, the UK government identify the short time frame for intervention to provide a clear, pro-innovation regulatory environment in order to make the UK one of the top places in the world to build foundational AI companies. Not too dissimilar to this EU legislators have signalled an intention to make the EU a global hub for AI innovation. On both fronts responding to risk and building public trust are important drivers for regulation. Yet, clear and consistent regulation can also support business investment and build confidence in innovation.

What remains critical for the industry is winning and retaining consumer trust, which is key to the success of innovation economies. Neither the EU nor the UK can afford not to have clear, proportionate approaches to regulation that enable the responsible application of  AI to flourish. Without such consideration, they risk creating cumbersome rules applying to all AI technologies.

What are the policy objectives and intended effects?

Similarities exist in terms of the overall aims. As shown in the table below, the core similarities revolve around growth, safety and economic prosperity:

What are the problems being tackled?

Again, similarities exist in terms of a common focus: the end-user. AI’s involvement in multiple activities of the economy, whether this be from simple chatbots to biometric identification, inevitably mean that end-users end up being affected. Protecting them at all costs seems to be the presiding theme:

What are the differences in policy options?

A variety of options have been considered by the respective policymakers. On the face of it, pro-innovation requires a holistic examination to account for the variety of challenges new ways of working generate. The EU sets the standard with Option 3:

What are the estimated direct compliance costs to firms?

Both the UK Approach and the EU AI Act regulatory framework will apply to all AI systems being designed or developed, made available or otherwise being used in the EU/UK, whether they are developed in the EU/UK or abroad. Both businesses that develop and deploy AI, “AI businesses”, and businesses that use AI, “AI adopting businesses”, are in the scope of the framework. These two types of firms have different expected costs per business under the respective frameworks.

UK Approach: Key assumptions for AI system costs

Key finding: Cost of compliance for HRS highest under Option 3

EU AI Act: Total compliance cost of the five requirements for each AI product

Key finding: Information provision represents the highest cost incurred by firms.

In light of these comparisons, it appears the EU estimates a lower cost of compliance compared to the UK. Lower costs don’t confer a less rigid approach. Rather, they indicate an itemised approach to cost estimation as well as using a standard pricing metric, hours. In practice, firms are likely to aim to make this more efficient by reducing the number of hours required to achieve compliance.

Lessons from the UK Approach for the EU AI Act

The forthcoming EU AI Act is set to place the EU at the global forefront of regulating this emerging technology. Accordingly, models for the governance and mitigation of AI risk from outside the region can still provide insightful lessons for EU decision-makers to learn and issues to account for before the EU AI Act is passed.

This is certainly applicable to Article 9 of the EU AI Act, which requires developers to establish, implement, document, and maintain risk management systems for high-risk AI systems. There are three key ideas for EU decision-makers to consider from the UK Approach.

AI assurance techniques and technical standards

Unlike Article 17 of the EU AI Act, the quality management system put in place by providers of high-risk AI systems is designed to ensure compliance. To do this, providers of high-risk  AI  systems must establish techniques, procedures, and systematic actions to be used for development, quality control, and quality assurance. The EU AI Act only briefly covers the concept of assurance, but it could benefit from publishing assurance techniques and technical standards that play a critical role in enabling the responsible adoption of AI so that potential harms at all levels of society are identified and documented.

To assure AI systems effectively, the UK government is calling for a toolbox of assurance techniques to measure, evaluate, and communicate the trustworthiness of AI systems across the development and deployment life cycle. These techniques include impact assessment, audit, and performance testing along with formal verification methods. To help innovators understand how AI assurance techniques can support wider AI governance, the government launched a ‘Portfolio of AI Assurance techniques’ in Spring 2023. This is an industry collaboration to showcase how these tools are already being applied by businesses to real-world use cases and how they align with the AI regulatory principles.

Similarly, assurance techniques need to be underpinned by available technical standards, which provide a common understanding across assurance providers. Technical standards and assurance techniques will also enable organisations to demonstrate that their systems are in line with the regulatory principles enshrined under the EU AI Act and the UK Approach. Similarities exist in terms of the stage of development.

Specifically, the EU AI Act defines common mandatory requirements applicable to the design and development of certain AI systems before they are placed on the market that will be further operationalised through harmonised technical standards. In equal fashion, the UK government intends to have a leading role in the development of international technical standards, working with industry, international and UK partners. The UK government plans to continue to support the role of technical standards in complementing our approach to AI regulation, including through the UK AI Standards Hub. These technical standards may demonstrate firms’ compliance with the EU AI Act.

A harmonised vocabulary

All relevant parties would benefit from reaching a consensus on the definitions of key terms related to the foundations of AI regulation. While the EU AI Act and the UK Approach are either under development or in the incubation stage, decision-makers for both initiatives should seize the opportunity to develop a shared understanding of core AI ideas, principles, and concepts, and codify these into a harmonised transatlantic vocabulary. As shown below, identification of where both initiatives are in agreement, and where they diverge, has been undertaken:

How AI & Partners can help

We can help you start assessing your AI systems using recognised metrics ahead of the expected changes brought about by the EU AI Act. Our leading practice is geared towards helping you identify, design, and implement appropriate metrics for your assessments.

 Website: https://www.ai-and-partners.com/

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The AI Act, set to be a global precedent, aims to address the risks associated with AI while encouraging the development of cutting-edge technology. One of the key aspects of this Act is its support for open-source, non-profit, and academic research and development in the AI ecosystem. Such support ensures the development of safe, transparent, and accountable AI systems that benefit all EU citizens.

Drawing from the success of open-source software development, policymakers can craft regulations that encourage open AI development while safeguarding user interests. By providing exemptions and proportional requirements for open ML systems, the EU can foster innovation and competition in the AI market while maintaining a thriving open-source ecosystem.

Representing both commercial and nonprofit stakeholders, several organisations – including GitHub, Hugging Face, EleutherAI, Creative Commons, and more – have banded together to release a policy paper calling on EU policymakers to protect open-source innovation.

The organisations have five proposals:

1. Define AI components clearly: Clear definitions of AI components will help stakeholders understand their roles and responsibilities, facilitating collaboration and innovation in the open ecosystem.

2. Clarify that collaborative development of open-source AI components is exempt from AI Act requirements: To encourage open-source development, the Act should clarify that contributors to public repositories are not subject to the same regulatory requirements as commercial entities.

3. Support the AI Office’s coordination with the open-source ecosystem: The Act should encourage inclusive governance and collaboration between the AI Office and open-source developers to foster transparency and knowledge exchange.

4. Ensure practical and effective R&D exception: Allow limited real-world testing in different conditions, combining aspects of the Council’s approach and the Parliament’s Article 2(5d), to facilitate research and development without compromising safety and accountability.

5. Set proportional requirements for “foundation models”: Differentiate between various uses and development modalities of foundation models, including open source approaches, to ensure fair treatment and promote competition.

Open-source AI development offers several advantages, including transparency, inclusivity, and modularity. It allows stakeholders to collaborate and build on each other’s work, leading to more robust and diverse AI models. For instance, the EleutherAI community has become a leading open-source ML lab, releasing pre-trained models and code libraries that have enabled foundational research and reduced the barriers to developing large AI models.

Similarly, the BigScience project, which brought together over 1200 multidisciplinary researchers, highlights the importance of facilitating direct access to AI components across institutions and disciplines.

Such open collaborations have democratised access to large AI models, enabling researchers to fine-tune and adapt them to various languages and specific tasks—ultimately contributing to a more diverse and representative AI landscape.

Open research and development also promote transparency and accountability in AI systems. For example, LAION – a non-profit research organisation – released openCLIP models, which have been instrumental in identifying and addressing biases in AI applications. Open access to training data and model components has enabled researchers and the public to scrutinise the inner workings of AI systems and challenge misleading or erroneous claims.

The AI Act’s success depends on striking a balance between regulation and support for the open AI ecosystem. While openness and transparency are essential, regulation must also mitigate risks, ensure standards, and establish clear liability for AI systems’ potential harms.

As the EU sets the stage for regulating AI, embracing open source and open science will be critical to ensure that AI technology benefits all citizens.

By implementing the recommendations provided by organisations representing stakeholders in the open AI ecosystem, the AI Act can foster an environment of collaboration, transparency, and innovation, making Europe a leader in the responsible development and deployment of AI technologies.

(Photo by Nick Page on Unsplash)

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The report suggests that by 2030, AI could boost the UK economy by £400 billion—leading to an annual growth rate of 2.6 percent.

Steven Mooney, CEO of FundMyPitch, commented:

“If AI is projected to bring billions to the UK economy, then why on earth aren’t our start-ups and SMEs getting the funding they need to take their businesses to the next level?

Time and time again, reports show that UK entrepreneurs struggle to secure access to credible funding or even an independent valuation, in stark contrast to other markets.

A failure to get ahead of the game on AI will have disastrous consequences for the economy, so giving full financial backing to up-and-coming companies that are pioneering developments in this technology should be a top priority.”

Google’s UK and Ireland boss, Debbie Weinstein, describes the transformative power of AI as unprecedented in the tech industry.

While concerns about job displacement due to AI exist, Weinstein reassures that new job opportunities will also arise as a result of AI implementation. She acknowledges the impact that this technology will have on people and emphasises the need to equip individuals with the necessary skills.

Recognising the profound impact AI will have on all aspects of society, Google says that it aims to ensure that individuals are prepared for this fundamental shift.

The report comes at a time when fears about the disruptive nature of AI are widespread. 

Professor Geoffrey Hinton, known as the “godfather of AI,” recently resigned from Google, expressing concerns about the potential misuse of AI tools.

Hinton warns of the possibility of bad actors using AI for nefarious purposes. However, he also acknowledges that someone else would have developed AI if he had not, suggesting that responsible development and regulation are necessary.

The call for caution and regulation in AI development has been echoed by experts worldwide. 

The launch of tools like ChatGPT and Midjourney has highlighted the potential for misuse. Google’s report emphasises the importance of regulation as AI technology advances and affirms that the company is actively collaborating with regulators globally.

Moreover, Google supports the establishment of a “national skills agenda” involving governments, businesses, and educational institutions. This collaborative effort aims to ensure that workers are not left behind as AI technology progresses.

Chris Downie, CEO of Pasabi, said:

“With AI set to bring unprecedented change to the economy, it is refreshing to see companies like Google looking to work proactively with Government to take a nuanced approach to regulation.

A national skills agenda and the UK Research Cloud are admirable initiatives, however, more attention still needs to be given to the risks posed by cyber criminals who are already hijacking the technology for their own harmful purposes.

From online scams to the global epidemic of fake reviews, to adopt a proactive approach to harness the latest fraud detection technologies to take the fight to online fraudsters.”

Google recognises the necessity of striking a balance, enabling agile regulation to attract inward investment while effectively managing the risks associated with AI.

By fostering collaboration between various stakeholders and prioritising skill development, the UK can capitalise on the competitive advantages offered by AI while safeguarding against negative consequences.

AI presents both challenges and opportunities, and it is crucial to navigate this technological shift thoughtfully and responsibly.

See also: UK will host global AI summit to address potential risks

Want to learn more about AI and big data from industry leaders? Check out AI & Big Data Expo taking place in Amsterdam, California, and London. The event is co-located with Digital Transformation Week.

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The strategic move demonstrates OpenAI’s commitment to expanding its operations, embracing diverse perspectives, and accelerating its mission of ensuring that artificial general intelligence (AGI) benefits all of humanity.

London, renowned for its exceptional talent pool, was chosen as the ideal location for OpenAI’s international office. The city’s vibrant technology ecosystem, welcoming regulatory environment, and thriving community of innovators make it the perfect hub for OpenAI to advance its cutting-edge research and engineering capabilities.

The London teams will work closely with local communities and policymakers, fostering collaboration on OpenAI’s mission to create and promote safe AGI.

“We are thrilled to extend our research and development footprint into London,” said Diane Yoon, OpenAI’s VP of People.

“We are eager to build dynamic teams in Research, Engineering, and Go-to-Market functions, as well as other areas, to reinforce our efforts in creating and promoting safe AGI.”

OpenAI has been at the forefront of AI research, creating breakthroughs in natural language processing, reinforcement learning, and other areas. With the establishment of its international office, OpenAI intends to tap into the diverse expertise and perspectives available in London, further bolstering its capabilities and amplifying its impact.

Sam Altman, CEO of OpenAI, also shared his excitement about the future prospects of the London office.

“We see this expansion as an opportunity to attract world-class talent and drive innovation in AGI development and policy,” Altman stated.

“We’re excited about what the future holds and to see the contributions our London office will make towards building and deploying safe AI.”

By establishing a physical presence in London, OpenAI can forge closer partnerships with local institutions, universities, and industry experts, fostering a collaborative environment that propels AI innovation forward.

(Photo by Andrew Neel on Unsplash)

Want to learn more about AI and big data from industry leaders? Check out AI & Big Data Expo taking place in Amsterdam, California, and London. The event is co-located with Digital Transformation Week.

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This marks a major step in the development of AI regulation in Europe, as these are the first-ever rules for AI. The rules aim to ensure that AI systems are safe, transparent, traceable, and non-discriminatory.

After the vote, co-rapporteur Brando Benifei (S&D, Italy) said:

“We are on the verge of putting in place landmark legislation that must resist the challenge of time. It is crucial to build citizens’ trust in the development of AI, to set the European way for dealing with the extraordinary changes that are already happening, as well as to steer the political debate on AI at the global level.

We are confident our text balances the protection of fundamental rights with the need to provide legal certainty to businesses and stimulate innovation in Europe.”

Co-rapporteur Dragos Tudorache (Renew, Romania) added:

“Given the profound transformative impact AI will have on our societies and economies, the AI Act is very likely the most important piece of legislation in this mandate. It’s the first piece of legislation of this kind worldwide, which means that the EU can lead the way in making AI human-centric, trustworthy, and safe.

We have worked to support AI innovation in Europe and to give start-ups, SMEs and industry space to grow and innovate while protecting fundamental rights, strengthening democratic oversight, and ensuring a mature system of AI governance and enforcement.”

The rules are based on a risk-based approach and they establish obligations for providers and users depending on the level of risk that the AI system can generate. AI systems with an unacceptable level of risk to people’s safety would be strictly prohibited, including systems that deploy subliminal or purposefully manipulative techniques, exploit people’s vulnerabilities, or are used for social scoring.

MEPs also substantially amended the list of prohibited AI practices to include bans on intrusive and discriminatory uses of AI systems, such as real-time remote biometric identification systems in publicly accessible spaces, post-remote biometric identification systems (except for law enforcement purposes), biometric categorisation systems using sensitive characteristics, predictive policing systems, emotion recognition systems in law enforcement, border management, workplace, and educational institutions, and indiscriminate scraping of biometric data from social media or CCTV footage to create facial recognition databases.

MEPs also expanded the classification of high-risk areas to include harm to people’s health, safety, fundamental rights, or the environment. They also added AI systems that influence voters in political campaigns and recommender systems used by social media platforms to the high-risk list.

To boost AI innovation, MEPs added exemptions to these rules for research activities and AI components provided under open-source licenses. The new law also promotes regulatory sandboxes – or controlled environments established by public authorities – to test AI before its deployment.

MEPs want to boost citizens’ right to file complaints about AI systems and receive explanations of decisions based on high-risk AI systems that significantly impact their rights. MEPs also reformed the role of the EU AI Office, which would be tasked with monitoring how the AI rulebook is implemented.

Tim Wright, Tech and AI Regulatory Partner at London-based law firm Fladgate, commented:

“US-based AI developers will likely steal a march on their European competitors given the news that the EU parliamentary committees have green-lit its groundbreaking AI Act, where AI systems will need to be categorised according to their potential for harm from the outset. 

The US tech approach is typically to experiment first and, once market and product fit is established, to retrofit to other markets and their regulatory framework. This approach fosters innovation whereas EU-based AI developers will need to take note of the new rules and develop systems and processes which may take the edge off their ability to innovate.

The UK is adopting a similar approach to the US, although the proximity of the EU market means that UK-based developers are more likely to fall into step with the EU ruleset from the outset. However, the potential to experiment in a safe space – a regulatory sandbox – may prove very attractive.”

Before negotiations with the Council on the final form of the law can begin, this draft negotiating mandate needs to be endorsed by the whole Parliament, with the vote expected during the 12-15 June session.

(Photo by Denis Sebastian Tamas on Unsplash)

Related: UK details ‘pro-innovation’ approach to AI regulation

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The Guarantor for the Protection of Personal Data (GPDP) announced last month that it was blocking access to OpenAI’s ChatGPT. The move was part of an ongoing investigation into whether the chatbot violated Italy’s data privacy laws and the EU’s infamous General Data Protection Regulation (GDPR).

The GPDP was concerned that ChatGPT could recall and emit personal information, such as phone numbers and addresses, from input queries. Additionally, officials were worried that the chatbot could expose minors to inappropriate answers that could potentially be harmful.

The GPDP says it will lift the ban on ChatGPT if its creator, OpenAI, enforces rules protecting minors and users’ personal data by 30th April 2023.

OpenAI has been asked to notify people on its website how ChatGPT stores and processes their data and require users to confirm that they are 18 and older before using the software.

An age verification process will be required when registering new users and children below the age of 13 must be prevented from accessing the software. People aged 13-18 must obtain consent from their parents to use ChatGPT.

The company must also ask for explicit consent to use people’s data to train its AI models and allow anyone – whether they’re a user or not – to request any false personal information generated by ChatGPT to be corrected or deleted altogether.

All of these changes must be implemented by September 30th or the ban will be reinstated.

This move is part of a larger trend of increased scrutiny of AI technologies by regulators around the world. ChatGPT is not the only AI system that has faced regulatory challenges.

Regulators in Canada and France have also launched investigations into whether ChatGPT violates data privacy laws after receiving official complaints. Meanwhile, Spain has urged the EU’s privacy watchdog to launch a deeper investigation into ChatGPT.

The international scrutiny of ChatGPT and similar AI systems highlights the need for developers to be proactive in addressing privacy concerns and implementing safeguards to protect users’ personal data.

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Related: AI think tank calls GPT-4 a risk to public safety

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The Center for Artificial Intelligence and Digital Policy (CAIDP) claims OpenAI has violated section five of the FTC Act—alleging the company of deceptive and unfair practices.

Marc Rotenberg, Founder and President of the CAIDP, said:

“The FTC has a clear responsibility to investigate and prohibit unfair and deceptive trade practices. We believe that the FTC should look closely at OpenAI and GPT-4.

We are specifically asking the FTC to determine whether the company has complied with the guidance the federal agency has issued.”

The CAIDP claims that OpenAI’s GPT-4 is “biased, deceptive, and a risk to privacy and public safety”.

The think tank cited contents in the GPT-4 System Card that describe the model’s potential to reinforce biases and worldviews, including harmful stereotypes and demeaning associations for certain marginalised groups.

In the aforementioned System Card, OpenAI acknowledges that it “found that the model has the potential to reinforce and reproduce specific biases and worldviews, including harmful stereotypical and demeaning associations for certain marginalized groups.”

Furthermore, the document states: “AI systems will have even greater potential to reinforce entire ideologies, worldviews, truths and untruths, and to cement them or lock them in, foreclosing future contestation, reflection, and improvement.”

Other harmful outcomes that OpenAI says GPT-4 could lead to include:

1. Advice or encouragement for self-harm behaviours
2. Graphic material such as erotic or violent content
3. Harassing, demeaning, and hateful content
4. Content useful for planning attacks or violence
5. Instructions for finding illegal content

The CAIDP claims that OpenAI released GPT-4 to the public without an independent assessment of its risks.

Last week, the FTC told American companies advertising AI products:

“Merely warning your customers about misuse or telling them to make disclosures is hardly sufficient to deter bad actors.

Your deterrence measures should be durable, built-in features and not bug corrections or optional features that third parties can undermine via modification or removal.”

With its filing, the CAIDP calls on the FTC to investigate the products of OpenAI and other operators of powerful AI systems, prevent further commercial releases of GPT-4, and ensure the establishment of necessary guardrails to protect consumers, businesses, and the commercial marketplace.

Merve Hickok, Chair and Research Director of the CAIDP, commented:

“We are at a critical moment in the evolution of AI products.

We recognise the opportunities and we support research. But without the necessary safeguards established to limit bias and deception, there is a serious risk to businesses, consumers, and public safety.

The FTC is uniquely positioned to address this challenge.”

The complaint was filed as Elon Musk, Steve Wozniak, and other AI experts signed a petition to “pause” development on AI systems more powerful than GPT-4.

However, other high-profile figures believe progress shouldn’t be slowed/halted:

Musk was a co-founder of OpenAI, which was originally created as a nonprofit with the mission of ensuring that AI benefits humanity. Musk resigned from OpenAI’s board in 2018 and has publicly questioned the company’s transformation:

Global approaches to AI regulation

As AI systems become more advanced and powerful, concerns over their potential risks and biases have grown. Organisations such as CAIDP, UNESCO, and the Future of Life Institute are pushing for ethical guidelines and regulations to be put in place to protect the public and ensure the responsible development of AI technology.

UNESCO (United Nations Educational, Scientific, and Cultural Organization) has called on countries to implement its “Recommendation on the Ethics of AI” framework.

Earlier today, Italy banned ChatGPT. The country’s data protection authorities said it would be investigated and the system does not have a proper legal basis to be collecting personal information about the people using it.

The wider EU is establishing a strict regulatory environment for AI, in contrast to the UK’s relatively “light-touch” approach.

Tim Wright, Partner and specialist tech and AI regulation lawyer at law firm Fladgate, commented on the UK’s vision:

“The regulatory principles set out in the whitepaper simply confirm the Government’s preferred approach which they say will encourage innovation in the space without imposing an undue burden on businesses developing and adopting AI while encouraging fair and ethical use and protecting individuals.

Time will tell if this sector-by-sector approach has the desired effect. What it does do is put the UK on a completely different approach from the EU, which is pushing through a detailed rulebook backed up by a new liability regime and overseen by a single super AI regulator.”

As always, it’s a balancing act between regulation and innovation. Not enough regulation puts the public at risk while too much risks driving innovation elsewhere.

(Photo by Ben Sweet on Unsplash)

Related: What will AI regulation look like for businesses?

Want to learn more about AI and big data from industry leaders? Check out AI & Big Data Expo taking place in Amsterdam, California, and London. The event is co-located with Digital Transformation Week.

Explore other upcoming enterprise technology events and webinars powered by TechForge here.

The post AI think tank calls GPT-4 a risk to public safety appeared first on AI News.