English legal system needs to keep pace with crypto and AI, lawyers say

[ad_1]

A leading technology adviser to the judiciary has proposed the creation of a new legal innovation institute that would detect loopholes in the law created by technologies such as crypto assets and AI, and promote a greater use of English law in global commercial contracts.

Professor Richard Susskind, technology adviser to the Lord Chief Justice and director of the LegalUK think tank, believes that an independent body, like the Alan Turing Institute, a pioneer in artificial intelligence research, would evidence areas of law that had failed to keep up with innovation.

The institute would also promote English law to global businesses as the law of choice to govern transactions in new areas such as blockchain.

The proposal comes as some lawyers fear that the English legal sector, which employs 365,000 people, will lose to rival centers such as Singapore and Dubai if its legislation does not keep pace with technological advances.

“The business world will be changed by technology and a challenge will be to provide a platform for the law to support these new technologies,” Susskind said.

He added that a research center would fit in with the UK government’s innovation strategy, released in July, which aims to make the country an international leader in fields such as AI.

This week, Tech London Advocates, a network of technology leaders and entrepreneurs, published authoritative advice on the legal and regulatory aspects of blockchain and its impact on litigation.

During a launch event Sir Geoffrey Vos, Master of the Roles, said he believed every lawyer would need to be familiar with blockchain, ‘smart’ legal contracts, agreements where contractual obligations are set. in computer code rather than in words, and cryptoassets.

Legal services contributed £ 29.6 billion to the UK economy in 2019, according to CityUK, a professional body.

English law is already widely used in global corporate transactions for the finance, shipping and insurance industries, including € 661.5 billion in derivatives trading contracts in 2018, according to a report by consulting firm Oxera.

“Mad Dog Jones” on display at Sotheby’s non-fungible token sale in London last June. NFT is one of the new technologies the courts are currently reviewing © Getty Images for Sotheby’s

The UK’s reputation as a leading center for global litigation provides a strong incentive for companies to opt for legal contracts governed by English law.

But the Social Market Foundation think-tank concluded in a recent report that “it is increasingly evident that English law in some areas is in desperate need of modernization” and is “failing” .

Richard Hyde, author of the report, said: “If companies cannot use English law to contract for cryptocurrencies, AI or green investments, they will use another system.

He added that a failed modernization could lead international companies to other countries where there is more certainty about how the law treats technologies such as AI.

However, work is already underway in England and Wales to help legal services adapt.

The Lawtech Delivery Panel, an industry group chaired by Vos, released a groundbreaking statement in 2019 that clarified that crypto assets can be treated in law like any other type of physical property.

Meanwhile, the Law Commission, an independent body that examines whether the legislation needs to be revised, is looking at the law regarding autonomous vehicles, for example.

advised

Separately, he recently concluded that adopting smart contracts would not require changes to the legal code.

The commission also examines cross-border digital assets, including cryptocurrencies, where it works alongside other jurisdictions, such as the United States-based Uniform Law Commission. He is expected to report in 2022.

The Justice Department said the government was continuing to review the legislation and was working with the Law Commission on specific reform projects “to ensure that English law is fit for the future.”

But there are still many areas of legal uncertainty. These include whether existing intellectual property, tax, and data protection laws apply to information stored on the blockchain, or whether existing limited liability laws covering businesses also apply to projects. related to blockchain.

In some cross-border crypto asset disputes, it is not clear which country has jurisdiction to adjudicate the lawsuits, given that intangibles are held virtually.

In AI technology, legal issues include the lack of clarity on liability for damages and whether existing anti-discrimination laws are sufficient to address the biases caused by algorithmic decision-making.

Courts in England and Wales are already dealing with disputes involving technology where the law is unclear.

In September, the London Court of Appeal ruled that an AI system dubbed Dabus could not be classified as an inventor on UK patent applications under English law because it was not a person. The decision contrasted with rulings in the same case by other courts, including the Australian Federal Court.

Recently, a lawsuit in the High Court, considered to be one of the first cases regarding the sale of non-fungible tokens, digital tokens that represent assets such as works of art, was filed by the collector of Liverpool art Amir Soleymani against the NFT Nifty Gateway market on the terms of a recent auction.

Miles Geffin, chief legal officer at Mishcon de Reya law firm, said there had been a “long period of legislative inertia” in recent years and more clarity was needed on the loopholes in the law relating to new technologies.

Progress is “currently quite fragmentary,” he said, adding that “a coherent vision” and “an implementation plan and political will” were needed.

Professor Ryan Abbott of the University of Surrey, who files worldwide legal challenges involving Dabus, believes more progress is needed to address the legal challenges posed by disruptive technologies.

“Industry strategy, policy and legislation all need to be coordinated. There is still work to be done, but there is some promise and I think the UK is on the right track.

Susskind said: “An institute would be a natural focal point for imaginative thinking about new areas of technology.”

[ad_2]