The regulation of Artificial Intelligence (AI) in Australia – navigating the future
Published on September 9, 2024 by Selwyn Black
Australia continues to evaluate how to regulate “high risk” artificial intelligence (AI). As AI continues to permeate various sectors, from healthcare to finance and beyond, the Australian Government appears to recognise the need for a regulatory framework to ensure its ethical, safe, and responsible use. This article explores key initiatives, challenges, and the potential impact on innovation.
AI Systems
The OECD member countries endorse the following definition of an AI system:
‘A machine-based system that, for explicit or implicit objectives, infers, from the input it receives, how to generate outputs such as predictions, content, recommendations or decisions that can influence physical or virtual environments. Different AI systems vary in their levels of autonomy and adaptiveness after deployment.’
Current landscape of AI regulation in Australia
Currently, Australia does not have specific, standalone legislation dedicated solely to the regulation of AI. Instead, the legal framework governing AI in the country is comprised of a combination of existing laws and industry-specific regulations. Australia’s existing laws, such as intellectual property, privacy protection, and directors duties, weave a web of regulation around the protection of the inputs received by AI and the impact of the AI outputs.
In 2019 Australia released a set of eight AI ethics principles which were modelled on the OECD’s principles. These principles highlight the importance of transparency, accountability, and fairness in AI systems. It is a voluntary framework seeks to mitigate risks involved for all parties. The Government’s Department of Industry, Science and Resources states the following intentions:
- achieve safer, more reliable, and fairer outcomes for all Australians.
- reduce the risk of negative impact on those affected by AI applications.
- businesses and governments to practice the highest ethical standards when designing, developing, and implementing AI.
On 17 January 2024, the Government published its interim response to the Safe and Responsible AI in Australia Discussion paper which was a 2023 public consultation on AI.
The Government says it plans to work with industry to develop voluntary AI Safety Standards. These guidelines outline the principles of fairness, transparency, and explainability that it says should be embedded in AI systems to ensure responsible innovation. There is also a plan to develop options for voluntary labelling and watermarking of AI-generated material and finally, the Government says it will set up a temporary expert advisory body to support the development of options for mandatory AI guardrails.
The Government has committed to five principles guiding its interim response including:
- Using a risk-based framework to support the safe use of AI and prevent harm occurring from AI;
- Avoiding unnecessary or disproportionate burdens for businesses, the community, and regulators;
- Being open in its engagement and working with experts from across Australia in developing its approach;
- Consistency with the Bletchley Declaration to support global action to address AI risks;
- Placing people and communities at the centre when developing and implementing its regulatory approaches.
Many of the AI risks outlined in the over 500 submissions received were well-known before recent advances in generative AI and include things such as
- inaccuracies in model inputs and outputs;
- biased or poor-quality model training data ;
- model slippage over time;
- discriminatory or biased outputs; and
- a lack of transparency about how and when AI systems are being used.
On 21 June 2024, the Australian, state and territory governments jointly released the ‘National Framework for the Assurance of Artificial Intelligence in Government’. This Framework was informed by the Australian AI Ethics Principles and it is likely to become the bedrock for AI regulation across Australia.
The definition of ‘high risk’ AI
By focusing on high risk areas with a temporary advisory body obviously raises questions such as how high risk areas will be defined and what will happen in the space of the regulation of low risk AI applications.
As AI technologies become more sophisticated, there is also a risk that regulatory frameworks may lag which will lead to potential gaps in oversight.
Another concern is the balance between fostering innovation and ensuring ethical use. Striking the right balance is crucial to prevent overly restrictive regulations that may stifle technological progress while still safeguarding against the risks associated with unchecked AI development.
The Australian Human Rights Commission (AHRC) has voiced its concern of four emerging harms of AI including privacy, algorithmic discrimination, automation bias and misinformation and disinformation.
The AHRC is calling on the federal government to identify and address gaps in Australia’s existing legislation to specifically safeguard against the emerging harms and novel risks arising from our use of AI. They support the appointment of an AI Commissioner.
Potential impact on innovation
Effective regulation is essential for building public trust in AI technologies, which, in turn, can drive innovation. A well-regulated environment provides a level playing field for businesses, promotes responsible practices, and encourages investment in AI research and development. By establishing clear guidelines and standards, the Government can create an ecosystem that supports ethical innovation and ensures the long-term sustainability of AI technologies in Australia. This is still a work in progress, but it is a start.
Please note that this article does not constitute legal advice. If you are seeking professional advice on any legal matters, you can contact Carroll & O’Dea Lawyers on (+61)1800 059 278 or via our Contact Page and one of our lawyers will be able to assist you.
