An Artificial Intelligence, Privacy, and Cybersecurity Update for Indian Companies Doing Business in the United States and Europe

Pivotal shifts have occurred in global data privacy, artificial intelligence (AI), and cybersecurity from executives facing more pressure to monitor their organizations’ cybersecurity operations, to an unprecedented wave of consumer data privacy laws and rapid advancements in AI technology use and deployment. Indian organizations should establish best practices to address these new (and emerging) laws, regulations, and frameworks.

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One Step Closer: AI Act Approved by Council of the EU

On 21 May 2024, the Council of the European Union approved the EU Artificial Intelligence Act (the “AI Act”). This is the final stage in the legislative process and comes after the EU Parliament voted to adopt the legislation on 13 March 2024. This final vote clears the path for the formal signing of the legislation and its publication in the Official Journal of the EU in the coming weeks. The AI Act will then enter into force 20 days after such publication with staggered transition periods of 6 to 36 months.

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ICO Publishes Its Strategic Approach to Regulating AI

On 30 April 2024, the UK’s Information Commissioner’s Office (“ICO”) published its strategic approach to regulating artificial intelligence (“AI”) (the “Strategy”), following the UK government’s request that key regulators set out their approach to AI regulation and compliance with the UK government’s previous AI White Paper (see our previous blog post here). In its Strategy, the ICO sets out: (i) the opportunities and risks of AI; (ii) the role of data protection law; (iii) its work on AI; (iv) upcoming developments; and (v) its collaboration with other regulators. The publication of the ICO’s Strategy follows the recent publication of the Financial Conduct Authority’s (“FCA”) approach to regulating AI.

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Top 10 Questions on the EU AI Act

The EU AI Act will be the first standalone piece of legislation worldwide regulating the use and provision of AI in the EU, and will form a key consideration in AI governance programs. The AI Act will have a significant impact on many organizations inside and outside the EU, with failure to comply potentially leading to fines of up to 7% of annual worldwide turnover.

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Regulatory Update: National Association of Insurance Commissioners Spring 2024 National Meeting

The National Association of Insurance Commissioners (NAIC) held its Spring 2024 National Meeting (Spring Meeting) March 15 through 18, 2024. This Sidley Update summarizes the highlights from this meeting in addition to interim meetings held in lieu of taking place during the Spring Meeting. Highlights include proposed updates to the regulatory review process for affiliated investment management agreements, continued discussion of considerations related to private equity ownership of insurers, and continued development of accounting principles and investment limitations related to certain types of bonds and structured securities.

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EU Formally Adopts World’s First AI Law

On March 13, 2024, the European Parliament formally adopted the EU Artificial Intelligence Act (“AI Act”) with a large majority of 523-46 votes in favor of the legislation. The AI Act is the world’s first horizontal and standalone law governing AI, and a landmark piece of legislation for the EU.

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UK and Australian Governments Sign “world-first” Online Safety and Security Memorandum of Understanding

On 20 February 2024, the UK Government and the Australian Federal Government co-signed a historic Online Safety and Security Memorandum of Understanding (MoU) signifying the bilateral cooperation between the two countries to help boost their respective online safety regimes. Notably, this is the first arrangement of its kind, with the MoU intending to encompass a wide range of digital online safety and security issues. These include illegal content, child safety, age assurance, technology facilitated gender-based violence, and addressing harms caused by rapidly evolving technologies, such as generative artificial intelligence.

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U.S. Department of Justice Signals Tougher Enforcement Against Artificial Intelligence Crimes

U.S. Deputy Attorney General Lisa Monaco signaled robust future enforcement by the Department of Justice (DOJ) against crimes involving, and aided by, artificial intelligence (AI) in her remarks at Oxford University last week and reiterated shortly thereafter at the Munich Security Conference.

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The U.S. Plans to ‘Lead the Way’ on Global AI Policy

Policymakers around the world took significant steps toward regulating artificial intelligence (AI) in 2023. Spurred by the launch of revolutionary large language models such as OpenAI’s GPT series of models, debates surrounding the benefits and risks of AI have been brought into the foreground of political thought. Indeed, over the past year, legislative forums, editorial pages, and social media platforms were dominated by AI discourse. And two global races have kicked into high gear: Who will develop and deploy the most cutting-edge, possibly risky AI models, and who will govern them?  In this article, published by the Lawfare Institute in cooperation with Brookings, Sidley lawyers Alan Charles Raul and Alexandra Mushka suggest that “the United States intends to run ahead of the field on AI governance, analogous to U.S. leadership on cybersecurity rules and governance—and unlike the policy void on privacy that the federal government has allowed the EU to fill.”

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UK Publishes Cyber Governance Code of Practice for Consultation

On 23 January 2024, the UK government published its draft Cyber Governance Code of Practice (the “Code”) to help directors and other senior leadership boost their organizations’ cyber resilience. The draft Code, which forms part of the UK’s wider £2.6bn National Cyber Strategy, was developed in conjunction with several industry experts and stakeholders – including the UK National Cyber Security Centre. The UK government is seeking views from organizations on the draft Code by 19 March 2024.

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