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AI & the Law

Updated: Jun 25, 2023

The ripple effect of Artificial Intelligence (“AI”) and Machine Learning (“ML”) amongst Indian regulations was acutely visible when, the Reserve Bank of India’s (“RBI”) vide an expression of the notice[1] last year invited relevant stakeholders from the AI/ ML industry to enlist as consultants to supervise the wealth of data available with the RBI. (Later it reportedly shortlisted 7 firms. The Securities Exchange Board of India too, essentially recognized the concept of the AI/ML through a circular[2]. This circular mandated intermediaries to report usage of the AI and/or ML, to protect investor interest from misrepresentation caused by the AI/ML’s unquantifiable behaviour.

Is it prudent therefore to also frame broad laws governing AI/ML?

Now, India does not have focused regulations relating to AI. Infact, the latest draft of the ‘Digital Personal Data Protection Bill, 2022’[3], only applies to processing of digital personal data wherein the recognition of such personal data is either through online data principals or through collection of such personal data, offline, which is thereby digitised. While aspects of ‘personal data’, ‘personal data breach’, ‘data principal’ and ‘data fiduciary’ are covered, the bill doesn't deal with AI. Since, data is most often these days processed either by AI or ML, it could be presumed that the definitions of ‘person’ and/or ‘data fiduciary’ includes reference to processing by AI/ML.

There is no doubt that artificial intelligence has multiple use cases. Even 2 years ago, in a paper published by the NITI Aayog paper on artificial intelligence, there is enough stress on the need for the data protection regulations in India, underlining the role of the Information Technology Act, 2000 and The Information Technology (Reasonable Security Practices and Procedures and Sensitive Personal Data or Information) Rules, 2011[4].

In 2018, the Ministry of the Electronics & Information Technology constituted four committees to develop initiatives around AI and one of the committee reports relates to leveraging AI for identifying national mission in key sectors[5]: identifying the bridge in the functioning of the Indian judiciary system by possibly reducing pendency of cases.

Competition Law is another key area for AI. Infact, in a report published by the Competition Commission of India (“CCI”), the report identifies privacy as a form of non-price competition. The combintion order by CCI in relation to Google's investment in Jio (http://164.100.58.95/sites/default/files/Notice_order_document/Order775.pdf) ould make for an interesting read around this. (Concerns around gathering of information about web surfers in the Google/double merger case: https://ec.europa.eu/competition/mergers/cases/decisions/m4731_20080311_20682_en.pdf had emerged; however, the Commission of the European Communities had approved the merger.)

Such multiple use case / effects of AI quite possibly risks privacy of data, security and perhaps lack of adequate privacy safeguards and a lack of consent from persons. The European Union (“EU”) member states, and EU council had approved Artificial Intelligence Regulation (“AI Act”) on 06, December, 2022. This proposed law widely recognizes use and threats of use by AI systems and imposes charges/penalties on the AI systems that propose a clear threat to the safety, livelihoods, and rights of the people. [1] It has even proposed a code of conduct. Similarly, around September 2021, Brazil had also passed a bill legislating a framework around artificial intelligence.


There is, therefore, a need for greater discussion on data and AL thereby as a source of market power in both digital and non-digital markets, and how India can develop a framework.

https://www.lexology.com/library/detail.aspx?g=d7e37012-570e-4e0a-a7f6-7e9bf187c4ac Views of the author are personal and do not constitute legal advice

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