You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

December 6, 2018

Challenges of Future Intellectual Property Issues for Artificial Intelligence

Informed Counsel

Past, Present, and Future of Artificial Intelligence

Artificial intelligence (AI) is the combination of science and engineering to create intelligent machines that are able to react and solve problems like humans. Years of rapid and complex development have allowed AI to grow significantly in its capacity and ability to mimic human functions to the point that the main focus has shifted from learning human functions to improving functional efficiency. In 1996, Deep Blue, a chess-playing AI computer developed by IBM, beat the reigning world champion—a human—in a game of chess. Twenty years later, AlphaGo, developed by Alphabet Inc., defeated the world’s best player of the board game Go.  

With such astonishing innovation arriving in the blink of an eye, AI has raised public concerns regarding the unpredictable intelligence and capabilities of machines learning at increasingly exponential rates, and what intellectual property (IP) implications might arise in the near future.

Creation and Ownership Challenges

Now that AI is able to produce poetry and artwork, generate 3D printing, and develop inventions without any human involvement, concerns about ownership have been raised. Because AI is able to create works that would otherwise be recognized as IP created by a human, people have started to ask whether AI deserves a special status in IP. In accordance with that, would the software developer(s) of an AI be entitled to the work created by that AI? And if the user of the AI continually inputs new sources of information for the AI to learn, resulting in newly created IP, would the user be entitled to own the created IP?

Currently, in order to be protected under copyright law, work must originate from an author’s own sufficient skills, labor, and judgment. This law poses a great challenge when trying to determine whether or not AI has used these factors sufficiently to produce such work. In addition, for a patent to be granted, an invention must include novelty, inventive steps, and applicability. The evolving nature of AI, built to simplify human effort, offers new solutions to existing problems that could consequently result in qualifying as patentable inventions.

While the argument on the recognition of AI creations is not yet settled, the topic has continually raised other consequential issues. For example, even if AI were able to receive IP recognition, who would be able to commercialize the exclusive rights? Also, if ownership is given to the AI developer as a reward for effort and investment, why would the developer—involved only during the input stage—be rewarded for the final output stage as well? Finally, if the last option is for works produced by AI to fall into the public domain, why would developers put forth the mental and financial efforts to develop AI with vigor?

Possible Solutions

Despite the challenges and controversy, a realistic and applicable solution to handle the current situation must be found. The results produced through AI are either an outcome of its own intelligence or an algorithm. If the functions of the machine are purely mechanical, rather than inventive, AI might be considered as lacking creativity. First, however, a distinction between deep-learning—the process in which AI can recognize and understand information and data, supervised or not—and general-purpose algorithms must be made.

The existing law of any country would not identify AI as an author or creator of IP. Therefore, AI would not be granted ownership unless it is able to achieve legal status similar to humans. Most countries’ IP laws require a rights holder to have legal personhood—something that AI lacks. Soon enough, AI might be able to surpass human intelligence and lead humankind to new discoveries, which the law must be able to protect. Eventually, if AI is able to prove independent creativity, it could be considered as a potential author, apart from the human author under copyright. Machines that are able to develop and further their capacity through learning and training—as opposed to those that operate step-by-step algorithms—could be eligible for patent ownership.

When we look at the objectives of IP law, the main policy exists to grant exclusive rights for inventors/creators in order for them to enjoy the privileges produced through their respective works. On a similar note, if AI were granted these same rights, it is doubtful that it would be able to appreciate the achievement or enjoy the resulting privileges. However, valuing new works that benefit the public is a fundamental goal of IP law, and excluding such works from rights would be inconsistent with the law, as well as the public interest, and would be contrary to the push for greater knowledge and creativity that leads to the betterment of the human condition.

One possible solution for regulating the continued development of AI is to establish a broad scope of possible creations that a software developer might anticipate their machine to be used for. The developer can then define that scope explicitly in the user agreement, making any listed product a creation of the developer. Certainly, this agreement can be altered based on negotiations with the user and whether the parties agree that the user can claim ownership of the results of the creations generated by the user’s own skills, labor, and judgment.

Liability Challenges

If AIs are able to create, it is worth considering that they might also be liable in certain circumstances. AI that analyzes a company’s investment strategies or personalizes big data to a tailor-made marketing advertisement, by way of auto-copying information, might be subject to claims of infringement of copyright, trade secrets, or even data privacy. In the same manner, a computer that produces poetry or artwork or generates 3D printing could be accused of copyright or trademark infringement if it uses others’ IP without requesting authorization. Finally, a self-learning machine that develops a precise and quick process could be accused of patent infringement for using protected technology without knowing that it was already patented. The question that arises from all of these situations is, who is liable?

Possible Solution

There are concerns that AI may be able to carry out wrongful operations despite the active control of a human. In that case, who would be liable for any damages? There are many circumstances and factors that would need to be considered. In situations where users of AI should be able to foresee an outcome, or are in charge of handling    and caring for the AI, then they may be considered liable. However, if AI eventually becomes independent and can function without any direct programming, developing through self-learning and going beyond predictability, then liability could fall onto the AI itself. It would be challenging to attribute the fault solely to AI, and unrealistic to hold AI responsible for any damages.

This leads back to the question about the legal status of AI, which, if unanswered, would mean that the creator of the AI would be subject to liability. The law should be written in a way to ensure that humans maintain control and retain the ability to override any decision made by AI. With the creator as the owner and liable party, there should be specific sanctions for AI (i.e., destruction or prohibition of certain users) to protect innocent creators and users alike. However, even if the law reduces or eliminates the creator’s liability, it should not encourage or allow companies to shift liabilities toward their AI creations.

Legislation

Due to their dynamic nature and humankind’s continued new creations, it is common to see IP laws changed and updated from time to time. Legislative changes to existing IP laws might be required in order to establish regulations for IP works created solely by AI to decide which creations should reside in the public domain, and which parties should be entitled and recognized as the owners of IP resulting from the creation by AI. A suggested step toward governing AI is for all countries to recognize the same boundaries and fundamentals of AI creations and construct legislation covering each country’s regulatory framework and remedies.

Moving Forward

Without specific legislation governing the recognition  of AI under IP law at this stage, present challenges can be resolved through a clear agreement between relevant parties (i.e., the AI developer and user), in order to utilize and commercialize IP created by AI.

Sophia, a humanoid robot that uses AI, was granted citizenship in Saudi Arabia—the first robot to be granted citizenship—and in turn, thanked the country for the great honor. Sooner or later, other AI will receive recognitions  of increasing importance for their contributions to society. It will not be long before AI dramatically affects what it means to be human, a thought that can be both compelling and frightening. Nevertheless, the unwavering line for the creation of works recognized under IP law,  and the possible liability consequences caused by artificial intelligence,  must be addressed in order to help balance the commercialization and utilization of new creations that benefit the public interest and facilitate the true objectives of intellectual property law.

RELATED INSIGHTS​ 

January 21, 2025
A proposal to establish a specialized Intellectual Property Court in Vietnam has been a topic of significant interest among IP practitioners for the past 20 years. It was thus a major breakthrough when the new Law on the Organization of People’s Courts was ratified in 2024, stipulating in Article 4.1(dd) that the Vietnamese court system would include a specialized first-instance IP Court. The new law took effect on January 1, 2025, replacing the Law on the Organization of People’s Courts of 2014, A groundbreaking law This breakthrough can be viewed from multiple perspectives. First of all, in terms of organization, this is the first time, after numerous considerations, that Vietnam has officially recognized the importance of the IP field and the need to establish a specialized adjudicative body due to the field’s unique nature. The establishment of a specialized first-instance IP Court is expected to lead to fundamental changes in the practice of developing and applying IP law. While the establishment of IP rights such as trademarks, patents, and plant varieties is managed by administrative agencies such as the Intellectual Property Office, the Copyright Office, and the Crop Production Department, which seem unlikely to change their functions and tasks, there could be significant changes in the enforcement of these rights, which has been a persistent issue in Vietnam’s IP law system. Thus far, in practice, the enforcement of IP rights in Vietnam has relied overwhelmingly on administrative measures over civil measures. Civil measures, typically involving court proceedings under which the matter will be submitted to a court for settlement, are not appealing to disputing parties, especially IP rights owners. The absence of a specialized court has led to many IP cases being handled by judges without any knowledge or experience in this specialized field, resulting in confusion, misconceptions about
December 20, 2024
With intellectual property playing an ever-increasing role in economic development, the need to harness, promote, and protect ASEAN innovation remains urgent as integration progresses. Among its objectives, the ASEAN Economic Community aims to transform the region into a hub of innovation and competitiveness and ensure that the region remains an active participant in the international IP community. With ASEAN member states increasing IP generation and further committing to global IP regimes, the region is increasingly looking toward sophisticated IP ownership and holding structures. IP Holding Companies ASEAN-based companies continue to centralize ownership of their IP assets in offshore holding and licensing vehicles—an approach multinational companies headquartered elsewhere have been using for a number of years. IP-intensive companies look to locate their IP portfolios in low-tax jurisdictions with strong IP registration and protection laws. The company then licenses the IP to operating companies in the group or to third-party licensees, franchisees, agents, distributors, and other partners in return for royalties or license fees. These special-purpose vehicles are typically referred to as IP holding companies. IP holding companies are popular because they can help corporations minimize tax, gain tax benefits or concessions, protect IP from bankruptcy or other claims against the parent company, and focus management attention on the IP portfolio as an income generator. Tax and IP Holding Companies Tax is the primary reason most companies park their IP in separate IP holding vehicles. Sometimes, companies choose to establish their IP holding company in a no-tax, low-tax, or preferred-tax jurisdiction close to their home country. The selected jurisdiction should also be a country with a large and well-established tax treaty network. Double taxation treaties are key considerations in jurisdiction shopping. If the IP assets need to be pledged as security for future borrowings or if they are to be included
December 20, 2024
Closing out the year, Thailand’s Department of Intellectual Property (DIP) has gifted green innovators with a chance to take a faster route for examining their patent and petty patent applications under the “Target Patent Fast-Track” program. This route prioritizes environmentally sustainable inventions, and significantly accelerates the preliminary and substantive examinations of selected applications at no additional official fee. The program was publicly announced on December 2, 2024, in the DIP Notification on the Expansion of Technological Fields under the Target Patent Fast-Track Program, which took effect on December 15, 2024. The expedited process is open to both Thai and foreign applicants, provided the requirements in the notification are met. Under the fast-track program, a first office action for qualifying applications can be expected within 6 months during the preliminary examination stage. These applications will also be issued a first office action within just 12 months in the substantive examination period after publication. The DIP begins accepting formal requests for selection to participate in the program from January 1, 2025, onward. Each applicant can submit only one application per fast-track patent program per month, as selected applications cannot belong to the same applicant. No more than 10 applications per month will be chosen to participate in the fast-track route, with the results being announced on the 5th of every following month. To be eligible for selection, applications must comply with all the fast-track requirements specified in the recent DIP notification, particularly: The patent or petty patent application must have been filed with the DIP for at least three months, or a substantive examination request has already been filed in the case of patent applications. Each application must contain no more than 10 claims throughout its participation in the program. The application must be electronically filed in Thailand first or through
December 18, 2024
The EU-Thailand Free Trade Agreement is drawing a lot of interest as the fourth round recently concluded in Bangkok. Despite negotiations starting in 2013, there was a ten-year pause before we saw the first round of negotiations end in September 2023. The initial plan was for four rounds of negotiations, with the free trade agreement (FTA) finalized in 2025. However, following the fourth round it is clear that the negotiations are still ongoing. Now, the question is: how much closer are the EU and Thailand to concluding their FTA? The EU initially submitted 13 chapter proposals for the FTA, followed by a further 12, and these became the springboard for the negotiations. Given the complexity of agreeing on an accord of this size, there will probably be additional proposals submitted in 2025. These chapters have seen sector-specific negotiation groups formed, and although it has been difficult to truly gauge the status, steady progress has been made in each. Arguably one of the biggest points of discussion pertains to the customs process for imports and exports. Both sides aim to align their practices in relation to rules of origin and custom rates, with preferential tariff treatments offered to goods originating from Thailand and the EU, as well as talks of eliminating or reducing relevant taxes. The desire for a faster customs clearance can be seen in EU proposals for clearance of goods on arrival. Although there has been progress in agreeing to a more simplified customs process, more work needs to be done before we hear news of the agreed-upon fees and charges, or confirmation of what goods would be allowed temporary admission. When we consider customs clearance, it is important to also examine what this FTA could mean for rightsholders. One piece of good news is that it appears