China wants to regulate artificial intelligence and Chinese tech companies are already making changes. This first-of-its-kind regulation will be under a microscope as implementation begins.
The Chinese authoritarian government is notorious for its use of technology in tracking its citizens and controlling the content they see, so it’s really no surprise that the Eastern superpower wants to lead the way in regulating artificial intelligence. The rest of the world is watching with bated breath to see how China implements and manages its regulations, looking for ways to follow suit and improve the system. Still, is it really possible to regulate an algorithm with ever-changing inputs and outputs?
Wired uses the following example of how businesses use AI algorithms in China:
“WEN LI, A Shanghai marketer in the hospitality industry, first suspected that an algorithm was messing with her when she and a friend used the same ride-hailing app one evening.
Wen’s friend, who less frequently ordered rides in luxury cars, saw a lower price for the same ride. Wen blamed the company’s algorithms, saying they wanted to squeeze more money from her.”
This is what China is trying to do away with, among other things, with the Internet Information Service Algorithmic Recommendation Management Provisions. Drafted by the Cyberspace Administration of China, which enforces cybersecurity, internet censorship, and eCommerce rules, the regulations prohibit fake accounts, manipulating traffic numbers, and promoting addictive content, as well as providing protection for delivery workers, ride-hail drivers, and other gig workers. Under the new rules, companies will have to adhere to new guidelines that include the prohibition of using personal characteristics to offer users different prices for a product (as in the example above), and companies are required to not only notify users when algorithms are used to make recommendations, but to also allow users to opt-out.
These regulations, which went into effect in March 2023, are the first to be implemented, but not the first to be proposed. The European Union has proposed regulations that would restrict use of facial recognition, prohibit algorithmic manipulation and regulate AI-enabled products (i.e. chatbots and computer games). But these proposed regulations could be debated for years in the EU, with no real timeline for completion or implementation.
Artificial intelligence is an ever-changing technology. Driven by machine learning, the very definition of AI suggests that there is continued learning and changing as the algorithm receives new input. Determining what the algorithm will spit out as an output when new input isn’t pre-determined is essentially impossible. Enforcing these regulations will be difficult at first, but the Chinese government has given the rest of the world something to watch. Seeing how they handle the cases presented to them and how the algorithms are impacted by these regulations.
In the United States, the FTC has already ruled that businesses are responsible for any racial or gender bias presented by the AI it uses. In the example given above, the issue was a difference in price, which some could argue is a form of bias. Two people sitting in the same place asking for a ride are offered different prices. Unless one person gets a new customer discount, the decision can be perceived as biased.
China is leading the way in regulating artificial intelligence, and the world will watch closely to see what goes wrong and what works. Once global governments figure out the best way to implement and enforce regulations, businesses worldwide will be forced to adjust. If your business uses AI for any purpose, it is incredibly important to ensure an expert review your processes and policies. Don’t wait until the last minute to make changes, start making those changes now so that when these rules come down, you’re ahead of the curve.