UAE plans to regulate self-driving cars and AI
The UAE will begin developing laws governing self-driving cars and artificial intelligence to prepare the country to embrace the technologies of the future. Mohammad Al Gergawi, Minister of Cabinet Affairs and the Future, set out details of the plan at the opening of the World Economic Forum’s Global Future Councils in Dubai yesterday.
He told the audience that the decision by the President, Sheikh Khalifa, on Saturday to allow the Cabinet to grant licences for future technologies will ensure the country is an example to other governments.
The establishment of RegLab will provide a safe testing environment for new technologies, which will then help to establish future laws about their use, he said.
“The UAE is going to become a laboratory of legislations with this announcement,” he said.
“We are going to be looking at the legislation around self-driving cars, 3D printers and other kinds of artificial intelligence that governments all over the world are trying to understand.”
He said that the time when governments could work alone are long gone and that countries must work together for the sake of the world’s future.
“When governments do not work together and try to go it alone it only creates delays,” he said. “The accumulative effect of countries not updating their legislation has been $4 trillion (Dh14.69tn) to date. If one country had that money they would be among the richest in the world.
“We have already seen some states distance themselves from others and turn to protectionism, but that is not the answer.”
Mr Al Gergawi said the rise of companies such as Amazon and Apple showed how quickly technology was advancing and that it was up to governments to continue to adapt.
“We shall work as a united task force to develop the goals of humanity. The future is in the hands of those who can imagine and design it, this is about the future of the world.”
There could be dire consequences if the use of artificial intelligence, including drones and self-driving cars, is not regulated properly, said World Economic Forum president Borge Brende.
“There need to be rules for the new technology,” he said. The UK is reviewing its laws to consider responsibility if a self-driving vehicle is involved in an accident, before it allows such cars on the roads.
He said: “Cyber attacks are on the rise and digital transactions now account for 12 per cent of all trade in the world.”
Mr Brende said we were only at the beginning of understanding the challenges of the digital frontier.
“The world is changing. You only have to look at the fact that many of the largest companies in the world did not exist 10 years ago,” he said.
“That is why we are relying on the input of the Global Futures Council over the next two days. It is the biggest brainstorming session in the world.”
The opening day of the Global Future Councils meeting also featured the announcement of a proposed framework for the regulation of personal data.
It will act as a guide for policy makers on how to effectively regulate personal data.
“There is a need for robust policy frameworks to govern disruptive trends,” said a spokesman for the Ministry of Cabinet Affairs and the Future.
The framework, called Data Policy in the Fourth Industrial Revolution: Insights on Personal Data, was the first policy paper to come out of the collaboration between the UAE’s Ministry of Cabinet Affairs and the Future and the WEF’s network of Centres for the Fourth Industrial Revolution.
The centres were set up to bring together governments, leading companies, civil society and experts from around the world to help shape the governance of technology.
The project was created to shape the development and use of technology in ways that maximise the benefits while minimising the risks.
The scheme aims to create projects that can be adopted by policymakers, legislators and regulators worldwide.
“Data policy choices are not binary decisions with clean and clear lines – data policy is more like a 3D puzzle,” said Anne Toth, WEF’s head of data policy. “There are over 120 different data protection laws currently in effect across the world.”
A UK body working to clean up financial markets will issue guidance on electronic trading for banks and other institutions, as technology such as artificial intelligence disrupts processes, its chairman said.
Financial institutions are adopting technologies to enhance productivity, better serve customers and reap higher returns.
In addition, they are facing scrutiny from regulators since the global financial crisis, and are required to report transactions and other cross-border business activity.
“Electronic markets are just as prone to abuse and manipulation as traditional markets are,” said Mark Yallop, chairman of the fixed income, currencies and commodities (FICC) Markets Standards Board (FMSB), based in the City of London.
The same people who previously would have thought of
Financial markets will require governance on how AI trading systems are developed and how systems are supervised
“spoofing” markets by manipulating them up or down to illegally elicit the highest value from end-of-day trades, “now write computer programmes to do the same thing”, he said.
The FMSB was set up as part of the Bank of England and UK Treasury Department’s Fair and Effective Markets Review in 2015, which made 21 recommendations to weed out misconduct in FMCC markets, including lengthening jail sentences for those convicted of financial crimes.
The FMSB, whose membership comprises around 50 international banks, asset managers, corporations and brokers, has no enforcement powers but is tasked with producing professional guidance on how to handle grey areas such as information sharing and price setting.
Apart from his role at the two-year-old organisation, Mr Yallop is a member of the BoE’s Prudential Regulation Committee and was a UK group chief executive of Swiss bank UBS until 2014.
The Middle East’s FICC trading volumes are modest compared to those in the United States, Europe, South America and Asia. However, its financial markets are growing and becoming better regulated and local institutions are expected to join the FMSB in the coming years, Mr Yallop said.
He said that some emerging technologies, such as digital ledger blockchain, could increase transparency in financial services by accurately recording trades and clarifying price formation for the rest of the market.
However, the impact of technologies such as AI and machine learning – where computer systems learn from ongoing data input and start making their own decisions – is less clear.
“I defy anyone to tell us what the effect the widespread application of machine learning on financial markets will be, because it doesn’t exist at the moment and nobody knows what will happen if you have thousands of computers with different AI systems operating against each other,” he said.
“What happens if we reach a mini crisis in markets? What if there is an unexpected data release in the US, or a company in Japan goes bust, or suddenly the Chinese foreign exchange figures are revised to half what they were before – how do machines react to these sorts of stresses? The application of technology to financial markets is a probable good, but it carries scary implications we need to be prepared for.
“Who writes the code? A 16-year-old in his bedroom, or an army of ex-defence professionals?” Mr Yallop said.
Helping the industry understand those risks will be an important part of FMSB’s work over the next two to three years.
The organisation has issued guidance this year on governance of algorithmic trading platforms, and another paper on the management of trading “venues” (electronic stock exchanges) is under consultation and should be finalised in January.
But more work needs to be done, Mr Yallop said.
Financial markets will require governance on how AI trading systems are developed, how systems are supervised during trading hours, and what mechanisms are in place to halt them if required – the so-called “kill switch”, he said.