The opportunities and risks of artificial intelligence were topics of a panel discussion organised by Enterprise Cayman at Cayman Enterprise City’s Signal House on 7 Aug.
The session, titled Decoding the AI Act, focused on the new phase of the European Union’s Artificial Intelligence Act (EUAI Act) and the possible implications for the Cayman Islands. The new phase of the EUAI law is designed to manage the powerful AI tools available and avoid their use for criminal or unethical purposes.
The session was moderated by Cristina Spratt, founder and principal consultant at Tidal Edge Consulting, a specialist in strategic planning, business transformation and operational resilience.
One of the panellists, Christopher Brett Young, a partner at the law firm Walkers, said the introduction of the new phase of the EU’s AI law meant Cayman would have to take its own action.
“If we have future plans to operate in the EU, that’s going to affect our decisions going forward,” he said. “We are a community that does move quickly, and what we’re going to see is it’s really important to take a first mover advantage here.”
He said there were no laws that directly applied to the EUAI Act in Cayman at present, but the jurisdiction is set up to take advantage of the opportunities in AI.
“We can be a leader in the Caribbean and in the world as a small offshore jurisdiction,” he said. “The key, I think, will be the legislators speaking to the key stakeholders and advisors to gauge what is required.”
The other panellist, Pieta Brown, a consulting director at global financial services firm Deloitte, discussed the EUAI Act and emphasised that Cayman’s legislation in the area had to work in tandem with global regulations.
The second set of EU rules, governing General Purpose AI (GPAI), the area subject to most rules, came into force at the start of August.
The EU classes systems in the insurance and banking sectors as “high risk AI systems”, alongside those linked to education, employment and utility supply, among others.
Brown said AI could be used to “add value to the Cayman Islands’ proposition”.
She added that a private members’ bill in the UK House of Commons had been tabled to set up a new AI regulatory body, and that other nations, such as Canada, Brazil and Peru, had also proposed legislation.
Brown said, “We don’t have AI specific laws and regulations at the moment, but everyone is looking at AI operators.”
She added, “There is a lot of AI going wrong, there’s a lot of AI doing what it’s meant to do, but being used by bad actors.”
She said AI could be used to fake video, audio and text, and that fakes could fool even experienced people.
Brown warned that legal decisions could be faked, and if they were not checked by a human, “there could be very serious consequences”.
She added that education and healthcare are areas where unscrupulous actors could use AI to cause damage.
Brown said, “We need a very dynamic approach to risk management, and what we do know now may not be appropriate in two months.”
She added that it is best to start with a solid AI policy and training, including analysis of the potential risks.
“People should also be mindful of all these existing requirements that are in place, such as privacy legislation,” she said.
She warned that AI was “far from perfect” and that it could be used to discriminate against people and for other harmful purposes.”
Brown added, “It’s certainly a powerful technology … we can’t foresee how it will be used for good or for bad.”
She called for a “pragmatic” approach to AI development with steps to mitigate any risks taken in tandem.
Young agreed.
“We are living in a world where AI is evolving,” he said. “It’s important there is human oversight and, for everybody in the room, it’s important we keep our jobs because we have a role to play in the future.
“It’s important to have that human contact … it’s very important that systems are used properly,” he said.
Young added that there was a “divergence of opinion” on AI among major powers such as the EU, the UK and the US and that it is vital to strike a balance between managing it and stifling innovation.
“It’s about balancing the oversight with pragmatism towards good and efficient business.”
