All you need to know | China AIGC Entrepreneurship Legal regulation and policy summary (July 2023)

China AIGC Entrepreneurship Legal Regulation and Policy Summary (July 2023)

01 Introduction

In recent years, the rapid advancement of Artificial Intelligence Generated Content (AIGC) technology has brought new opportunities for social and economic development. Various industries have started to pay attention to the application of AIGC-related technologies in commercialization, and AIGC-related startups and projects have emerged one after another. However, the development of AIGC has also brought new challenges, such as spreading false information, infringing on personal information rights, data security, and bias and discrimination issues.

In order to cope with the rapid development of AIGC, seven departments including the Cyberspace Administration of China, the National Development and Reform Commission, and the Ministry of Education officially released the “Interim Measures for the Management of Artificial Intelligence Generated Content Services” on July 10th. This is also the world’s first regulatory regulation in the field of AIGC.

In addition to this dedicated regulatory regulation, China has issued a number of normative documents in various aspects such as technological development, network security, personal information protection, and internet information, forming a multi-level and multi-perspective governance system in the field of artificial intelligence.

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This article is a summary of the current domestic and international regulatory policies in the field of artificial intelligence compiled and organized by Shanghai Mankun Law Firm.

02 Regulation of AIGC in China

(I) Laws

“Law of the People’s Republic of China on the Promotion of Science and Technology”

The basic law in the field of science and technology in China, revised for the second time in 2021 and officially implemented on January 1, 2022.

“Personal Information Protection Law of the People’s Republic of China”

Officially implemented on November 1, 2021, it includes provisions on artificial intelligence, such as prohibiting the use of personal information for illegal activities and infringement of personal rights, and requiring the transparency and interpretability of artificial intelligence decision-making.

“Data Security Law of the People’s Republic of China”

Officially implemented on September 1, 2021, it includes provisions on artificial intelligence, such as strengthening the security protection and management of artificial intelligence-related data.

“Cybersecurity Law of the People’s Republic of China”

Implemented on June 1, 2017, Article 22 stipulates that network operators should take technical measures and other necessary measures to prevent and reduce the occurrence of cybersecurity incidents, including the use of artificial intelligence and other technologies.

(II) Departmental Regulations

“Interim Measures for the Management of Artificial Intelligence Generated Content Services”

On April 11, 2023, the Cyberspace Administration of China released the “Interim Measures for the Management of Artificial Intelligence Generated Content Services (Draft for Comments)” (hereinafter referred to as the “Measures (Draft for Comments)”). After collecting and considering opinions from all parties, the Cyberspace Administration, together with the National Development and Reform Commission, the Ministry of Education, the Ministry of Science and Technology, the Ministry of Industry and Information Technology, and the State Administration of Radio and Television, officially released the “Interim Measures for the Management of Artificial Intelligence Generated Content Services” (hereinafter referred to as the “Interim Measures”) on July 10, 2023. As the world’s first national-level legal document directly regulating AIGC, the “Interim Measures” will be officially implemented on August 15, 2023, and China’s agile governance and management model for artificial intelligence is beginning to show results.

“Regulations on Algorithm Recommendation Management for Internet Information Services”

The “Regulations on Algorithm Recommendation Management for Internet Information Services” (referred to as the “Algorithm Recommendation Regulations”) that will take effect on March 1, 2022, require algorithm recommendation service providers to establish and improve the mechanism for reviewing algorithm mechanisms, models, data, and application results on a regular basis. They are not allowed to set up algorithm models that induce users to become addicted or engage in excessive consumption in violation of laws, regulations, or ethical standards. In addition, the “Algorithm Recommendation Regulations” require that algorithm recommendation services be filed with the Internet Information Department: algorithm recommendation service providers with opinion attributes or social mobilization capabilities should complete the filing procedures within ten working days from the date of providing services by filling in information such as the service provider’s name, service form, application field, algorithm type, algorithm self-assessment report, and content to be publicized through the Internet Information Service Algorithm Filing System.

“Regulations on Deep Synthesis Management for Internet Information Services”

The “Regulations on Deep Synthesis Management for Internet Information Services” (referred to as the “Deep Synthesis Regulations”) that will take effect on January 10, 2023, are the core regulatory provisions in the field of AIGC. “Deep synthesis technology” refers to the use of deep learning, virtual reality, and other similar algorithms to generate and synthesize information such as text, images, audio, videos, and virtual scenes, including technologies such as text-to-speech, music generation, face generation, face replacement, and image enhancement. Therefore, AIGC falls within the scope of the “Deep Synthesis Regulations” regulation.

The “Deep Synthesis Regulations” clearly state that deep synthesis service providers should review the input data and synthesis results of deep synthesis service users using technical or manual methods. In addition, if providing services that generate or significantly change information content functions such as intelligent dialogue, synthesized voices, face generation, and immersive realistic scenes, they should prominently label and notify the public about the situation of deep synthesis in reasonable positions and areas of the generated or edited information content.

(III) Departmental Normative Documents

“Ethical Norms for the Next Generation of Artificial Intelligence”

On September 25, 2021, the National Committee for the Governance of the Next Generation of Artificial Intelligence released the “Ethical Norms for the Next Generation of Artificial Intelligence” (referred to as the “Ethical Norms”), aiming to integrate ethics and morals into the entire life cycle of artificial intelligence and provide ethical guidelines for individuals, legal persons, and other relevant organizations engaged in activities related to artificial intelligence.

The “Ethical Norms” have gone through stages such as special investigations, centralized drafting, and soliciting opinions, fully considering ethical concerns such as privacy, bias, discrimination, and fairness in various sectors of society. It includes general principles, specific activities’ ethical norms, and organizational implementation. The “Ethical Norms” propose six basic ethical requirements, including enhancing human well-being, promoting fairness and justice, protecting privacy and security, ensuring controllability and trustworthiness, strengthening responsibility, and enhancing ethical literacy. At the same time, it puts forward 18 specific ethical requirements for specific activities such as the management, research and development, supply, and use of artificial intelligence.

“Guidelines for Ethical Security Risk Prevention in Network Security Standards Practice – Artificial Intelligence”

To prevent ethical security risks in artificial intelligence, on January 5, 2021, the Secretariat of the National Information Security Standardization Technical Committee organized the compilation of the “Guidelines for Ethical Security Risk Prevention in Network Security Standards Practice – Artificial Intelligence”, providing guidance for organizations or individuals engaged in activities such as research and development, design and manufacturing, and deployment and application of artificial intelligence.

(IV) Industry Standards and Guidelines

“Guiding Principles for the Review of Registration of Artificial Intelligence Medical Devices”

In March 2022, the Center for Medical Device Evaluation issued the “Guiding Principles for the Review of Registration of Artificial Intelligence Medical Devices”, further standardizing the quality control requirements and registration declaration requirements for the entire lifecycle process of artificial intelligence medical devices. At the same time, it was proposed that third-party databases can also conduct algorithm performance evaluations, and specific requirements for the third-party databases in terms of authority, scientificity, standardization, diversity, closedness, and dynamics were clarified.

“Guiding Principles for the Classification of Artificial Intelligence Medical Software Products”

On July 8, 2021, in order to further strengthen the supervision and management of artificial intelligence medical software products and promote the high-quality development of the industry, the National Medical Products Administration organized the formulation and formal publication of the “Guiding Principles for the Classification of Artificial Intelligence Medical Software Products” (referred to as the “Guiding Principles” below).

In the “Guiding Principles”, the Medical Products Administration clearly defined artificial intelligence medical software as “independent software based on medical device data that uses artificial intelligence technology to achieve its medical purposes. The classification of medical devices containing artificial intelligence software components can refer to these principles.” It also provided a clear definition of medical device data as “objective data generated by medical devices for medical purposes, which may include objective data generated by general equipment under special circumstances.” In addition, the “Guiding Principles” also defined management attributes and management categories.

“Key Points for the Evaluation of Deep Learning Assisted Decision-Making Medical Device Software”

In July 2019, the Center for Medical Device Evaluation of the National Medical Products Administration (referred to as the “Center”) issued the “Key Points for the Evaluation of Deep Learning Assisted Decision-Making Medical Device Software”, which clarified the scope of evaluation for general deep learning assisted decision-making medical device software and proposed a risk-based lifecycle regulatory approach.

(V) Local Regulations

“Shanghai Municipal Regulations for Promoting the Development of Artificial Intelligence Industry”

On September 22, 2022, the 44th meeting of the 15th Shanghai Municipal People’s Congress Standing Committee voted to pass the “Shanghai Municipal Regulations for Promoting the Development of Artificial Intelligence Industry”, which will be implemented starting from October 1, 2022.

“Shenzhen Economic Special Zone Artificial Intelligence Industry Promotion Regulations”

In September 2022, Shenzhen announced the country’s first special legislation for the artificial intelligence industry, the “Shenzhen Economic Special Zone Artificial Intelligence Industry Promotion Regulations.” It will be implemented from November 1, 2022.

“Shanghai Data Regulations”

On November 25, 2021, the 37th meeting of the Standing Committee of the 15th Shanghai Municipal People’s Congress passed the “Shanghai Data Regulations,” which will be implemented from January 1, 2022.

(VI) Local work documents

“Beijing’s Implementation Plan for Accelerating the Construction of a Globally Influential Artificial Intelligence Innovation Source (2023-2025)” and “Several Measures to Promote the Development of General Artificial Intelligence Innovation in Beijing”

On the afternoon of May 30, 2023, the press conference for the major technological achievements session of the 2023 Zhongguancun Forum was held. At the conference, Liu Hang, Deputy Inspector of Beijing Municipal Science and Technology Commission and Zhongguancun Management Committee, announced two policies, the “Implementation Plan for Accelerating the Construction of a Globally Influential Artificial Intelligence Innovation Source in Beijing (2023-2025)” (hereinafter referred to as the “Implementation Plan”) and the “Several Measures to Promote the Development of General Artificial Intelligence Innovation in Beijing” (hereinafter referred to as the “Several Measures”). Beijing will use these two policies to further coordinate resources and comprehensively promote the construction of an independent technology system for artificial intelligence and the development of the industry ecosystem from the perspective of encouraging and guiding industry development based on innovation and development common needs.

The release of these two policies aims to accelerate the implementation of the innovation-driven development strategy, establish a high-level national new generation artificial intelligence innovation development pilot zone and national artificial intelligence innovation application leading zone, continuously enhance the global influence in the field of artificial intelligence, further promote artificial intelligence innovation leadership and healthy development, and support the construction of Beijing as an international center for scientific and technological innovation.

03 Global Regulation of AIGC by Various Countries

European Union

“Data Governance Act”

It took effect in June 2022. The act is the first legal draft submitted under the framework of the “European Data Strategy,” with its initial content in November 2020. The “Data Governance Act,” overall, focuses on institutional innovation, encourages data sharing, improves data utilization efficiency, facilitates the flow and use of data resources, and achieves higher public policy objectives. First, it aims to build a system for the reuse of data by the public sector. Second, it establishes an architecture conducive to the development of data intermediaries. Third, it provides normative guidance for altruistic behavior with data.

In addition, in Chapter 6 of the “Data Governance Act,” a European Data Innovation Board is established to provide advice and incorporate information on data sharing service providers, cross-industry data sharing, data reuse, and other aspects.

Draft of the “Artificial Intelligence Act”

In April 2021, the European Commission proposed the draft of the “Artificial Intelligence Act”, which is considered a milestone event for the European Union in the field of artificial intelligence and the broader EU digital strategy. However, the progress of the proposal has not been as smooth as expected, and Members of the European Parliament have not reached a consensus on the basic principles of the proposal.

“Ethical Guidelines for Trustworthy Artificial Intelligence”

Released in 2019, these guidelines cover seven aspects: human agency and oversight; technical robustness and safety; privacy and data governance; transparency; diversity, non-discrimination, and fairness; societal and environmental well-being; and accountability.

“General Data Protection Regulation”

Adopted in 2016 and effective from 2018, the purpose is to address the issues of collecting and using user data. It replaces the 1995 EU Data Protection Directive to adapt to the development of cloud computing, the internet, and big data. The purpose of the regulation is to constrain internet and big data companies in their handling of personal and sensitive data, and to safeguard the legitimate rights and interests of data subjects. Compared to its predecessor, the Data Protection Directive, the GDPR can directly take effect in all EU member states without any country having to transpose it into national law.

United Kingdom

“Promoting Innovative AI Regulatory Approach”

On March 29, 2023, the UK published the white paper “Promoting Innovative AI Regulatory Approach”, outlining five principles for AI governance. It proposes a principle-based approach to AI governance to provide confidence for businesses and the public in the use of AI and to provide the industry with a regulatory approach that is certain and consistent. In this white paper, the UK sets out five principles that AI should adhere to in its development and use across sectors, and regulatory bodies will publish guidelines for best practices in each field based on these principles. The white paper also emphasizes the importance of collaborative governance involving multiple stakeholders such as the government, industry, and businesses, as well as the importance of strengthening global cooperation and interoperability in AI governance to quickly achieve the UK’s global leadership position in the field of AI.

Italy

On March 31, 2023, the Italian Data Protection Authority (Garante) requested a ban on the use of the AI chatbot ChatGPT developed by OpenAI in Italy and launched an investigation into the application of ChatGPT for alleged violations of privacy rules. The Office of the Privacy Commissioner of Canada recently announced that it has initiated an investigation into OpenAI for suspected “collection, use, and disclosure of personal information without consent”.

United States

“Artificial Intelligence Risk Management Framework” (AI RMF) 1.0

The National Institute of Standards and Technology (NIST) of the United States released the “Artificial Intelligence Risk Management Framework” (AI RMF) version 1.0 in January 2023. The framework aims to guide organizations in reducing security risks, avoiding biases and other negative consequences, and improving the credibility of artificial intelligence systems during development and deployment.

As early as 2016, the United States issued two national framework documents, “National Artificial Intelligence Research and Development Strategic Plan” and “Preparing for the Future of Artificial Intelligence.” These documents are framework-oriented and promotional rather than regulatory or restrictive, and have been continuously updated in recent years. The two policy frameworks aim to actively promote the development of artificial intelligence technology and technological innovation. The documents only propose principled approaches to address the challenges brought about by artificial intelligence technology.

Canada

“Artificial Intelligence and Data Act”

In June 2022, Canada released the “Artificial Intelligence and Data Act.” This act aims to regulate the transactions of artificial intelligence systems between international and provincial levels. The law stipulates that measures should be taken to reduce harm and output biases caused by high-impact artificial intelligence, publicly disclose public information about artificial intelligence, authorize the Minister of Innovation, Science and Industry to develop policies related to artificial intelligence systems, and prohibit the possession or use of illegally obtained personal information to protect the privacy of data and achieve the purpose of designing, developing, using, or providing artificial intelligence systems.

Germany

“Autonomous Driving Act”

Released in July 2021, the purpose of this bill is to provide a legal basis and management framework for the commercial application of autonomous driving technology. One of the highlights of this bill is to provide a legal basis for the normal operation of Level 4 autonomous vehicles on specific sections of highways, and make clear provisions on relevant technical requirements, driving conditions, and data processing. Germany has become the first country in the world to integrate autonomous vehicles into daily traffic and promote them nationwide as a result.

Another important aspect of the bill is the establishment of a technical supervision system for “autonomous driving features.” Therefore, owners of intelligent motor vehicles must regulate the use of motor vehicles to ensure the safety of motor vehicle operation and the compatibility of the motor vehicle’s operating environment, and take responsibility for the use of motor vehicles. These responsibilities include regular maintenance of the system to ensure the proper operation of autonomous driving, taking precautions to comply with traffic rules, and responsibility for technical supervision. To fulfill this obligation, vehicle owners should appoint individuals with specialized skills as technical monitors to remotely monitor and intervene in the operation of the vehicle.

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