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Tech impacting ‘every area of business in every sector’
International law firm Clifford Chance has published the second edition of its Guide to Technology Disputes in Asia Pacific 2023, reflecting on key issues arising from technology protection, regulation, and disputes in the Asia-Pacific region, including Hong Kong, China, Singapore, Japan, and Australia.
Lauren Croft
The guide reveals how companies operating in a number of jurisdictions should best protect and enforce their intellectual property in a digital environment, protect their data and data privacy and handle cyber security incidents, and how to deal with a range of technology regulation and disputes, covering areas like digital assets, anti-money laundering and responsible tech.
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In terms of the Australian market, Clifford Chance Australia partner Naomi Griffin told Lawyers Weekly that technology is impacting “every area of business in every sector” and that the guide shows more disputes and litigation arising around new technologies, including in relation to artificial intelligence (AI) and digital assets.
“While the emergence of these new technologies provides many opportunities for businesses in Australia and around the world, the regulatory framework is increasingly complex. The reliance on technology and the novel legal questions raised by new technologies can give rise to difficult disputes in Australia and across multiple jurisdictions,” she explained.
“In 2022, we saw an increasing number of tech disputes in the region focusing on crypto assets, data breaches and the use of AI. We expect this trend to continue in 2023, with AI tools like Chat GPT bringing new challenges to the table.”
As such, Australian organisations now have to navigate new and complex regulatory landscapes in relation to technology and data.
“Late last year, the Australian Securities and Investments Commission (ASIC) released its strategic priorities for 2023 — with most of these priorities being technology related — including scams, sustainable finance practices, crypto assets, cyber and operational resilience, and digital technology and data,” Ms Griffin said.
“Data breaches, data misuse and the illegal transfer of personal data remain key litigation and enforcement risks due to a global proliferation of heavy-hitting data governance laws, international data flows being more challenging than ever before, and increasingly strict cyber security standards in many parts of the world. Just last year, the first data breach class action was launched in Australia.”
With these new developments come new regulatory frameworks, as well as a number of “hurdles”, according to Ms Griffin.
“Technology investments and transactions, as well as launches or expansions of technology-focused companies, face increasing numbers of hurdles to overcome, including in relation to sanctions, money laundering, export controls, investment controls, licensing requirements and other restrictions. With pressure on the technology sector post-COVID, disputes may also arise from post-deal issues materialising,” she added.
“New regulatory frameworks are being established in relation to digital services and new technologies such as digital assets, with associated claims, disputes and regulatory enforcement action expected to follow as contractual rights and obligations are affected and company compliance programmes struggle to keep pace with developments in this area.”
The guide also notes that the emergence of technologies, including blockchain, big data, AI and quantum computing, have developed further opportunities, and these new technologies give rise to complex disputes across multiple jurisdictions.
Clifford Chance partner Ling Ho confirmed this in a statement.
“Enhanced regulatory frameworks are being implemented that impact everything from data use to cyber security to product liability, to the resilience of the digital asset ecosystem,” she said.
“In this increasingly complex regulatory framework, legal issues arising in one sphere can no longer be looked at in isolation, and their interplay with the rest of the legal landscape needs to be comprehensively assessed when driving an effective tech risk management strategy or navigating a technology-related dispute.”
Therefore, moving forward, Australian lawyers will need cross-border skills to deal with technology disputes, which Ms Griffin said were increasingly international.
“Technology knows no borders, which means that large-scale technology-related litigation has become increasingly international,” she said.
“Moving forward, Australian lawyers will be required to be across developments in multiple forums, to manage the complexity of emerging risks and disputes. With the rapid progress and new applications of technologies such as distributed ledger technology, data mining, artificial intelligence (AI) and quantum computing, lawyers not only need to have a combination of international disputes management experience, but also technical expertise in these technologies along with operational resilience and data management.”
