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Bill Magee
Corporate Scotland suffers from U-turn on intellectual property rights code of practice talks

Digital dithering by the UK Government shortly before it called a General Election has left ambitious businesses, keen to exploit next-generation technologies, well and truly disconnected. If not commercially stranded.

In a classic U-turn, the Westminster political powers-that-be pulled talks aimed at achieving a first-time industry led agreement on an intellectual property rights code of practice.

IPR represents the very DNA of an enterprise as organisations seek ways to protect precious data and other assets whilst attempting to embrace digital advances on offer.

The World Intellectual Property Organisation (WIPO) describes IPR as "the fruits of an enterprise's creative and innovative talents..key towards success as basis towards enhancing a company's value."

One senior Scots business executive, who asked not to be named, summed up: "At a time when we all desperately need reassurance, in the face of the largely as yet unknown commercial effects of AI, to pull the rug away from these key talks is unforgiveable." Expect more expert IT outsourcing by organisations seeking to exploit such potentially transformative smart tech.

Such uncertainty comes legal experts warn the marketplace will suffer as a consequence as increasing numbers of content creators are forced to fight in the courts to enforce their IP rights, especially in the face of unfettered and powerful generative artificially intelligent tools.

The Economist warned some months ago of a "battle royal" brewing over copyright and AI, as Big Tech pushes such software products jam packed full of aggressive (ro)bot web crawlers ever-threatening to ride roughshod over IP law.

The IPR talks collapse marks a setback in the UK's lofty ambitions to be a global superpower on the artificial intelligence front.

An over-ambitious stance some hoped, nevertheless, would strike a balance between developers' desire to access quality data to train AI models, and content creators' right to control and commercialise access to their copyrighted works.

Burness Paull, Scotland's top IP disputes experts for the fifth year in a row, identifies "contentious" areas it manages include an ongoing spread of patent, trade mark, copyright, design right, confidential data and arts and entertainment.

Generally IP involves "tangible" assets including buildings, machinery equipment and office supplies, "intangible" represents the physical existence and fruits of a company's creative and innovative talents.

Pinsent Masons senior practice development lawyer Gill Dennis said: "The government's current focus on achieving greater transparency, rather than on limitations on the use of copyright works, is unlikely to comfort content creators."

Instead of such an openness, its stance has muddied the field of intellectual property and confirmed some have already expressed a willingness to enforce their IP rights against AI developers through legal moves.

In turn, businesses face litigation as AI tools become more popular. They should consider different kinds of risks associated with the advanced technology infringing IPR especially when it involves personal data.

Kathy Berry, TMT/IP counsel at Linklaters, described the talks breakdown as a blow to both AI developers and content creators alike, adding a call to action is required to strike "a better balance of interests."

Under the current legal framework developers are not legally able to copy third-party copyright works in the UK for the purpose of training their AI models, save in very limited circumstances.

Similarly, content creators have limited ability to monitor and police use of their work by developers. End product is double confusion when what is urgently required is a dose of clarity.

The talks were halted despite a "call for action" from the House of Lords communications and digital committee to the lower house. Representing a short window to steer the UK towards a resumption and positive outcome to talks.

Such assets are legally protected and that protection can be enforced in a court of law, independently identified, transferable and having an economic lifespan.

Different legal instruments exist by which an outfit may achieve IP protection and the WIPO stresses an organisation should conduct an IP valuation and get on board expert help if required.

Having an idea of how much assets may be worth will be helpful for various transactions including licensing, sale, donation of IP rights or entering into joint ventures and other collaborative arrangements.

The government has also been reminded it has a "duty of care" on the issue. In turn it stated, rather cryptically, it was considering other IPR/AI options adding it will get back to the stakeholders involved.

The next government better not hang around. Otherwise it faces the likely prospect of a barrage of angry IP content creators and bruised businesses raising AI copyright concerns in the courts.

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