The evolving field of artificial intelligence (AI) is significantly reshaping various sectors across Canada, prompting a critical evaluation of our legal frameworks. From intellectual property to financial markets, AI presents exciting opportunities and complex challenges that test traditional regulations.
This article outlines five key developments at the intersection of AI and Canadian business law:
1. Evolving Regulatory Landscape. Canada currently lacks dedicated legislation addressing the intellectual property ramifications of generative AI. Regulators are actively assessing the adequacy of existing laws to determine whether they can sufficiently govern the creation, use and protection of AI-generated content.
2. AI in Capital Markets. AI is increasingly integrated into the services of market participants, particularly in customer support and risk modelling in the financial services industry. The Canadian Securities Administrators Staff Notice and Consultation 11-348 recognizes AI’s dual nature as a tool for operational efficiency and a source of emerging risks. Market participants in all industries are reminded that a tailored disclosure approach is essential to address unique risks involved in the use of AI systems, such as data bias and cybersecurity threats.
3. AI Patent Precision. Clear definitions in AI-related patents are essential to ensure enforceability in Canada’s evolving IP landscape. In the Technoplasma Systems case, the court invalidated a patent related to 3D printing—a key AI-adjacent technology—due to ambiguous claim language. This underscores the critical need for precision in such patents, especially for non-standard technical terms.
4. AI Litigation. Canadian courts are addressing new legal questions regarding AI technology. The Patent Appeal Board is currently investigating whether an AI system, known as DABUS, can be considered an inventor under Canadian law. Notably, authorities in the U.S. and the U.K. have already ruled that AI lacks the capacity for inventorship or authorship rights.
5. Copyright and Generative AI. AI’s reliance on extensive datasets raises intricate questions regarding authorship and fair dealing. Considering the lack of AI-specific provisions in the Copyright Act, discussions on legislative amendments are emerging.
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