While AI is changing the business landscape for the better for many startups, one legal expert advises companies to take advantage of the technology, as it could inadvertently land them in legal quagmire on everything from copyright to data privacy.
The F&B sector is one of the newest. Report positive ROI with AI investment. However, an AI skills gap has also been reported in the UK, and while businesses are keen to implement AI, they may be limiting themselves. There is a shortage of human resources with AI skills.
This can lead to mistakes with potentially large consequences, both financially and in terms of reputational damage.
Copyright disaster
talk to IFA MagazineKirstin McKnight, practice group leader at commercial law firm Legal Vision, said education is absolutely key if companies want to leverage AI and avoid legal disputes and compliance issues.
According to McKnight, the biggest risk for companies is using AI-output material and inadvertently infringing copyrighted material in the process. In particular, high-profile legal battles have arisen after it was reported that material protected as intellectual property was used to train AI models.
This means that when someone using AI to create content enters a prompt, they may actually receive a response that is close to or identical to the copyrighted work (such as text, logos, images, etc.).
McKnight advised, “To protect your business, it’s essential to carefully review the licenses and terms of use of the AI tools you use. Implement internal review processes to check for potentially infringing output, and clearly define ownership rights in your contracts.” This advice is especially true if you are using AI content commercially.
misleading information
It’s also a good idea to be careful as generative AI can be prone to “hallucinations,” which are false or misleading information that the system presents as correct. For example, if you’re a business owner using AI to create marketing materials, make sure you have a human fact-checking process in place. what is this Job seekers are ignored There are risks when using AI to create resumes.
According to new scientistthe hallucinations are getting worse. The site reports hallucination rate rankings and reveals that some models have experienced double-digit increases in hallucinations since recent releases.
When AI is introduced into customer-facing organizations, potentially dangerous situations arise. a Bot used by New York City authoritiesFor example, it gave “dangerously inaccurate” advice on everything from housing policy to workers’ rights.
Develop a framework
While the EU is working on its own, AI frameworkCompanies cannot relax their governance. “Many companies deploy AI tools without establishing clear policies,” McKnight said. “This lack of governance can quickly turn into serious legal and operational risks, as employees can misuse the AI, input inappropriate or sensitive data, or fail to recognize harmful outputs, leading to data breaches and potentially costly litigation.”
For example, if you are using AI that has been given access to your customers’ personal data, you need to have protocols in place to ensure this data is protected and anonymized and that permissions are obtained.
Regulation is key to preventing these data protection and compliance mistakes. Create a robust AI plan that your employees will be trained on. This training should also include understanding the compliance rules and regulations already in place regarding the use of AI.
McKnight added: “It’s important to stay informed of evolving regulations, conduct regular audits of your AI systems, and design a flexible strategy to quickly respond to new legal requirements as they emerge.”
While AI adoption is progressing at a dizzying pace, companies cannot use lack of regulatory understanding or ignorance as an excuse when things go wrong. Staying aware and paying attention is your biggest shield when it comes to deploying AI without taking any risks.
