AI and Developing Privacy Laws in Asia

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AI and Developing Privacy Laws in Asia

Why is it important? 

        The Asia-Pacific region is one of the fastest growing Artificial Intelligence(AI) markets in the world, with over 40% of total investments into information-communications technology going into AI. Most major countries in the region, such as China, Japan, South Korea, India, Taiwan, and Singapore, have all announced multi-million (or billion) dollar national plans to invest into AI research and development. The impact of AI is already beginning to be seen in current society: China's Alibaba, for instance, uses machine learning in its Agriculture Brain platform to increase yields and reduce losses. Investment firms such as Prudential Singapore and Sompo Japan are similarly using machine learning for fraud-detection and streamlining assessments. 

        However, with such widespread uses, there also come a slew of ethical and legal problems touching on (amongst many others) privacy and security. For instance, the huge databases required to train AI as well as for AI to operate on, raise issues of data ownership, security, and information privacy. More general privacy issues of AI arise from their enhanced ability to the misuse of personal information in ways that intrude on privacy rights, while regulators are also restricted by the need to promote growth and development of AI. Although the Europe has begun discussions on a landmark legal framework for AI (see my earlier post on this here), Asian countries are not falling behind either, with major legal reforms and new frameworks/guidelines being implemented in the past several years.  

How have some Asian countries developed Privacy Laws for AI? 

China

        China, as an example, has developed concrete laws regulating the use of AI as well as applying various existing laws and regulations to AI. Existing laws applicable to AI and privacy include the Cybersecurity Law (requiring standards of security for user information which could be used by AI), Advertising law (which for instance can prohibit using AI to generate fake reviews or testimonials), and Contract Law (involving the general principles of good faith and prohibition of unfair terms, including where AI are involved in decision-making process). China also launched the New Generation Artificial Intelligence Development Plan in 2017, with hopes to be a world leader in AI by 2030. 

        Regarding more direct legislation in China, in March 2022, a new AI regulation on the use of algorithms in online recommendation systems by companies was passed. This law mandates that AI services must be 'moral, ethical, accountable, transparent, and "spread positive energy"'. They also include more common restrictions such as requiring transparency on when AI are used, an opt-out option, and prohibits price differentiation based on analysis of personal data. However, another effect of this is to help authorities regulate content recommendations, which may "shape public opinion". Shanghai also passed the "Shanghai Regulations on Promoting the Development of the AI Industry" in September 2022, which outlines methods for sound and sustainable development of AI technology through "sandbox" supervision, which is quite similar to the current draft version of the EU legal framework for AI. 

South Korea 

        Similar to China, Korea also launched the "Basic Plan for Artificial Intelligence" in 2017 to begin the steps of regulating AI, followed by the Digital New Deal which promised $7B in funding grants for new technology involving AI. The Digital New Deal accelerated Korea's digital transformation, by creating an AI hub and a "digital data dam" to accumulate high quality data for AI training and make it publicly available. Korea also published the National Guidelines for Artificial Intelligence Ethics in 2020, centered around three basic principles of Respect for Human Dignity, Common Good of Society, and Fitness for Purpose. Furthermore, Korea's three main data privacy laws were amended in 2020 to clarify and promote data usage. In particular, they were amended to distinguish between personal, pseudonymized, and anonymized data, as well as establishing a central data privacy regulatory authority (the Personal Information Protection Commission) and transfer relevant provisions relating to privacy in the former Network Act and Credit Information Act. Overall, these developments have allowed Korea to become one of the leading countries in both AI development and legal regulation.