Interpreting Shanghai’s Legislation on Artificial Intelligence - 2022-09-09
Which industries have mainly benefited from the building of industrial advantages in the past five years?
Five years of exploration of the AI industry
"The Shanghai Regulations set the development direction of the AI industry in Shanghai," Ding Botao told the reporter. Unlike the Data Regulations of Shanghai Municipality, the Shanghai Regulations on AI are comprehensive industrial regulations, aiming to build Shanghai into a “highland" in the AI industry. By putting major technological innovation, important industrial development and the construction of key application scenarios in a more prominent position, the Exposure Draft specifies the development direction for Shanghai's AI industry.
"When the development rules of an industry enter the legislative stage, it shows that we have formed a relatively deep understanding of its adjustment or promotion," Chen Jidong told the reporter. The release of the Exposure Draft marks a new improvement in Shanghai's understanding of the AI industry and its governance.
To implement China’s Development Plan for New-Generation Artificial Intelligence, Shanghai issued the Implementation Opinions on Promoting the Development of New-Generation Artificial Intelligence in Shanghai Municipality in 2017, which elevated AI into Shanghai’s priority development strategy for the first time, officially opening the prelude to the development of th AI industry in the city.
As for top-level planning, Shanghai has successively rolled out The Implementation Measures on Accelerating the High-Quality Development of Artificial Intelligence, The Action Plan for Building Shanghai into a Highland of Artificial Intelligence and Establishing a First-Class Innovation Ecosystem (2019-2021), The 14th Five-Year Plan for the Development of Shanghai's Artificial Intelligence Industry (hereinafter referred to as the "Plan"), and other policies.
In terms of organizational safeguard, Shanghai has established the Leading Group on Work Related to the Artificial Intelligence Industry and the Strategic Advisory Expert Committee of Shanghai Municipality on Artificial Intelligence.
As for resources integration, Shanghai has built the country's first AI innovation and application pilot area and national new-generation AI innovation and development pilot area.
As far as the capital market is concerned, the establishment of the Shanghai Artificial Intelligence Industry Investment Fund has promoted the listing of a number of leading enterprises on the STAR Market of the Shanghai Stock Exchange.
Regarding ecosystem building, a number of industrial organizations have been set up, including the Shanghai AI Industry Association, the Global AI Academic Alliance, and the AI Young Scientists Alliance.
As for governance system building, Shanghai has established a Working Group on Governance within its Special Committee on the National Pilot Zone and the Shanghai Municipal Special Committee on AI Industry Security, and other organizations.
In terms of forum research, Shanghai has continued to hold forums on AI legal construction, security and governance, and issued The Shanghai Initiative for Safe and Secure AI Development, The Blue Book of World Artificial Intelligence Rule of Law, and other reports.
In addition, Shanghai has explored local legislation on AI for many years, and continuously promoted research on trusted AI.
In 2021, the 14th Five-Year Plan for the Development of Shanghai's Artificial Intelligence industry was officially released for implementation, calling for efforts to substantially enhance Shanghai's AI technology innovation capability and industrial competitiveness, reach the world-leading level in some fields and basically build Shanghai into a "highland" of AI with greater international influence. This plan also calls for making AI a deep empowering force to boost digital transformation in the fields of economy, life and governance, help improve the city's efficiency, core competitiveness and soft power, and become the core driving force for Shanghai's urban digital transformation and development. In the meantime, the plan specifies the need to further improve the AI innovation talent gathering and cultivation system, preliminarily establish an AI regulatory system, a standards system and a regulatory system, and form a "Shanghai Solution" for agile governance, so as to contribute Shanghai wisdom to global AI governance.
By 2035, Shanghai as a whole will reach the world-leading level of AI development. It will then become a central node city of AI in the world, with the agglomeration of global resources, extensive and in-depth applications, a complete industrial chain, and agile and reliable governance. It will form a landscape of deep integration between ubiquitous, intelligent, and all-round AI and urban development, thus laying a solid foundation for building Shanghai into a modern socialist international metropolis oriented towards the future.
Focusing on the advantages of Shanghai's AI industry
Ding Botao pointed out that in the draft regulations, Shanghai has highlighted its own characteristics and advantages in the development of the AI industry, and its advantages mainly lie in the two aspects of scientific research and development and industrial focus.
As for highlighting Shanghai's advantages in research and development, Section 2 of Chapter II of the Exposure Draft focuses on scientific and technological innovation, and sets out various provisions, which include: supporting universities, research institutions and enterprises to carry out basic theoretical research, R&D of key common technologies, as well as relevant interdisciplinary and cross-field research; supporting the construction of key laboratories and major research platforms; supporting the establishment of new R&D institutions; encouraging full-domain innovation and independent R&D; encouraging the opening up and sharing of scientific and technological resources; supporting special AI innovation projects; promoting the management mode reform of research organizations; and establishing an incentive mechanism conducive to promoting the successful transformation of science and technology in the AI field.
In terms of industry focus, Section 2 of Chapter 3 of the Exposure Draft clarifies the key directions for promoting the development of Shanghai's AI industry. The Exposure Draft calls for Shanghai to promote the high-quality development of basic hardware, key software and intelligent products by intensifying policy support, building an innovation system and promoting the development of clusters.
As for specific sectors, the Exposure Draft supports the development of five major industrial segments, including intelligent chips, AI framework software and system software, intelligent robots, intelligent connected vehicles, UAVs and unmanned ships, while a series of standards have been formulated for relevant sectoral organizations.
Regarding intelligent chips, the Exposure Draft supports relevant entities to develop cloud chips and cloud intelligent servers, encourage forward-looking layouts for brain-inspired chips, and cultivate an intelligent chip application ecosystem.
Concerning AI framework software and system software, the Exposure Draft supports relevant entities to develop AI system software and server-level operating systems; supports relevant entities to develop and promote automatic machine learning systems and further improve system efficiency, versatility and ease of use; and encourages relevant entities to develop operating systems for intelligent products and promote the development of various application functions.
As for intelligent robots, the Exposure Draft promotes the standardization and modularization of intelligent robot software and hardware systems, supports the cultivation of intelligent robot system integrators, and encourages relevant enterprises, product users and financial institutions to expand the application scenarios of intelligent robots through product leasing and service procurement and other ways. At the same time, relevant departments will promote relevant industrial organizations to formulate standards for robot intelligence level grading and application security testing, guide the iteration of intelligent robot technology, and safeguard the information security and use safety of intelligent robots.
Regarding intelligent connected vehicles, the Exposure Draft supports the independent research and development and industrial application of key technologies, operating systems, proprietary chips and core components of intelligent connected vehicles; and supports relevant entities to carry out the test, demonstrative application and demonstrative operation of intelligent connected vehicles on highways (including highways) and urban roads (including urban expressways), as well as in parking lots and other areas in Shanghai in accordance with relevant provisions, and promote the test and application of driverless equipment in specific areas or on roads. The Exposure Draft calls upon relevant departments to formulate specific provisions on the testing, demonstrative application and demonstrative operation of intelligent connected vehicles.
Concerning UAVs and unmanned ships, the Exposure Draft supports the construction of civil unmanned aviation test bases (test areas), UAV take-off and landing sites and general-purpose airports, and UAV operation management service platforms, calls for strengthening multi-departmental collaborative supervision and providing flight route planning, electronic fence setting and other services through operation management service platforms, and supports the expansion of UAV application scenarios. It also calls for improving electronic channel mapping, intelligent shipping communication and other support systems for unmanned ships, and for carrying out channel testing of unmanned ships in specific areas.
Ding Botao remarked, "Unlike the fairly broad characterization of the industry in Shenzhen's AI regulations, the key industries highlighted in the Exposure Draft are very focused. At the same time, provisions are set forth on introducing the rules of relevant sectors, which plays a strong role in guiding industrial development."
Chen Jidong told the reporter that the Shanghai Regulations have clearly defined the direction and key areas of development of the AI industry and provide strong legislative support for Shanghai to achieve the goal of building world-class industrial clusters.
Experts explain what local characteristics are in the legal code for AI
Laying a data base for the development of the AI industry
Ding Botao pointed out that the Exposure Draft provides a driving force for the development of Shanghai's AI industry. For example, concerning the optimization of element resources allocation, it puts forward various support and promotion measures in terms of high-performance computing power, progressiveness algorithms and high-quality data sets. At the same time, regarding the development of resources, it provides a comprehensive safeguard for the talents, funds, R&D, equipment and energy consumption that are needed for the development of the AI industry.
The reporter noted that Section 1 of Chapter 2 of the Exposure Draft specifies the basic elements of promoting the development of the AI industry, covering computing resources, implementation of the East-To-West Computing Resource Transfer Project and construction of the Yangtze River Delta National Hub, computing power R&D and open source, algorithm circulation and trading markets, construction of high-quality data sets, and rational development of application data, among other aspects.
"Compared with Shenzhen’s regulations, the biggest characteristic and innovation of the Shanghai Regulations are that the latter promotes the circulation, use and operation of basic factors, and boosts the protection of the rights and interests of relevant entities in the process, so as to better mobilize and stimulate the vitality of the market, mobilize the enthusiasm of industrial participants, and promote the development and improvement of the AI industrial ecosystem," Chen Jidong told the reporter. As for application empowerment, the Exposure Draft focuses on Shanghai's urban digital transformation and stresses the need to leverage the role of the AI industry in economy, life, governance and other aspects to thoroughly empower and build Shanghai into a “highland" for the development of the AI industry, with emphasis on scenario cultivation, scenario opening, scenario operation and so on.
In the interviews with the reporter, both experts mentioned that at the very start of legislation, the Regulations of Shanghai Municipality on Promoting the Development of the Artificial Intelligence Industry mutually support with the Data Regulations of Shanghai Municipality, connect with and deepen the Data Regulations of Shanghai Municipality from an AI industry perspective, and promote the circulation and use of data in the AI industry.
Chen Jidong pointed out that although it does not involve as many provisions on data as the Data Regulations of Shanghai Municipality, the Exposure Draft nevertheless has rich content and innovations, as specifically reflected in two major aspects.
First, in terms of high-quality data sets, it calls for and stresses the need to establish high-quality data sets for industries, as well as the need to build a large-scale AI database for Shanghai and collect statistics on data resources, so as to facilitate the subsequent agglomeration of resources.
In the early survey and research process, Ding Botao also found that many AI enterprises need large amounts of data for training and modeling, but the cost of collecting data by themselves is very high, and data quality is difficult to guarantee. "We hope that through the new regulations, we can encourage AI enterprises to obtain these high-quality data sets through market channels, especially through the Shanghai Data Exchange. On the one hand, it will reduce the cost and risk that enterprises face in obtaining data. On the other hand, it will promote the development of Shanghai's data factor market."
Second, in terms of the rational development of application data, the scope of categorical, hierarchical and orderly opening up and supply of public data has been expanded at the government end, while specific support at the enterprise end is earmarked for relevant entities to apply, independently or jointly, for the opening up public data, and safeguard the fair use and opening up of data for small and medium-sized enterprises and individual developers. At the same time, Shanghai supports AI enterprises to develop and use the data generated in AI applications, encourages enterprises to engage in relevant data product trading through the Shanghai Data Exchange, and promotes data circulation and trading in the industry.
"This is a major highlight of the Regulations of Shanghai Municipality on Promoting the Development of the Artificial Intelligence Industry," Chen Jidong told the reporter, "In the process of data circulation, there is a problem of imbalanced supply. At the enterprise side, this system protects the possibility for small and medium-sized enterprises and individual developers to use public data."
Ding Botao also told the reporter that Shanghai's idea of AI legislation has drawn upon that of the Data Regulations of Shanghai Municipality. For example, in the aspect of AI asset evaluation, it follows the ideas of data asset evaluation used in the Data Regulations of Shanghai Municipality. As for the trading and circulation of algorithm models and computing resources, reference is also made to the provisions of data trading and circulation, which represents the kind of connectivity with and breakthrough over data circulation, trading and asset evaluation.
Innovating the regulatory mode, and regulating AI ethics
"Another major innovation of Shanghai's AI legislation is the establishment of an AI ethics committee in Chapter V on industrial governance, which advocates innovative hierarchical governance, while regulating developer ethics and calling upon enterprises to rationally apply AI technology and strengthens the protection of workers and special groups," pointed out Chen Jidong. The regulation of industrial governance has laid an ethical foundation for industrial development and draw the safety bottom line of industrial development.
Ding Botao also believed that the proposed regulations provide the basic rules of governance for the development of Shanghai's AI industry, with innovation in the regulatory mode being a major feature.
Regarding innovative hierarchical governance, Article 63 of Chapter V of the Exposure Draft calls upon the relevant municipal departments to implement hierarchical governance according to the risk situation, application scenarios, scope of impact and other specific scenarios of AI applications, carry out application tests in specific areas and ranges, and explore sandbox-based supervision. Social organizations and individuals are encouraged to supervise the R&D and application of AI. At the same time, Shanghai has set up an Expert Committee on Artificial Intelligence Ethics to promote the establishment of ethics and self-discipline norms in the AI field and assess potential risks of artificial intelligence applications in key fields such as life, health and public security.
As for ethical norms, the Expert Committee on Artificial Intelligence Ethics is mandated to guide relevant industrial organizations and enterprises to formulate ethical norms and code of conduct for their AI product R&D and design personnel, strengthen the assessment of potential hazards and benefits of AI, conduct study and put forward solutions to emergencies in complex AI scenarios.
At the same time, relevant entities are required not to engage in irrational differentiated treatments when they use big data, algorithms and other technologies to provide AI products and services. When using biometric technology to provide services, relevant entities shall mark the content of their biometric information and take secure and controllable technical safeguard measures. The municipal department for cyberspace administration shall strengthen the regulation of biometric information, supervise and guide biometric service providers to provide relevant services.
With regard to the protection of workers and care for special groups, the draft regulations point out that employers shall comply with laws and ethical norms when using AI technology to assist with labor discipline management, labor work scheduling, recruitment and promotion decision-making and other applications, set no discriminatory requirements, and protect the legitimate rights and interests of workers. A call is also made for strengthening the application of AI in education, medical care, old-age care, care for children, assistance to the disabled and other areas, so as improve the quality of life for special groups such as the elderly, the disabled and minors. In providing intelligent public services, entities should give full consideration to the needs of the elderly and the disabled, so as to avoid creating obstacles to their daily lives.
Driving the coordinated development of the AI industry in the Yangtze River Delta region, and leading the way for formulating relevant regulations
As a demonstrative city in the Yangtze River Delta region, Shanghai has taken the lead in the development of the AI industry.
Xiao Sa, a partner of Dentons Law Firm, told 21st Century Business Herald that The Regulations of Shanghai Municipality on Promoting the Development of the Artificial Intelligence Industry provide a legal safeguard for the coordinated development of the AI industry in the Yangtze River Delta region, and are of great significance for strengthening organizational leadership, promoting institutional innovation, strengthening diversified participation, optimizing statistical monitoring, and boosting open cooperation.
The regulations mention the coordinated and integrated development of the AI industry in the Yangtze River Delta region several times.
In the General Principles section, Article 10 of Chapter I of the Exposure Draft calls for strengthening regional cooperation in coordinating and integrating the development of the AI industry in the Yangtze River Delta region, and jointly promoting the cross-regional connectivity of AI industry development plans, mutual recognition of technical standards, sharing and mutual recognition of test data in key fields, cost sharing and benefit sharing of infrastructure construction, and other work.
As for infrastructure, the draft regulations call for the implementation of the East-To-West Computing Resource Transfer Project and the construction of the Yangtze River Delta National Hub. Shanghai shall implement the East-To-West Computing Resource Transfer Project in accordance with the national plan, promote the collaborative development of the cloud network, improve the cross-network and cross-regional data interaction capabilities of data centers, enhance edge computing capabilities for specific scenarios, and strengthen the overall planning and intelligent scheduling of computing power; collaborate with other provinces and cities in the Yangtze River Delta region to build a Yangtze River Delta hub node of the national integrated big data center system, optimize the infrastructure construction layout of data centers, guide the intensive, large-scale and green development of data centers, promote the intensive and service-oriented innovation of computing power, data and application resources, and safeguard computing power needed for the development of the AI industry.
Ding Botao, Deputy Director of the Information Research Institute of the Shanghai Academy of Social Sciences, pointed out that the role of Shanghai's AI legislation in promoting the development of the AI industry in the Yangtze River Delta region involves three major aspects.
First, Shanghai has taken the lead in AI legislation, which plays a leading role in the Yangtze River Delta region. "Currently, the Yangtze River Delta region as a whole also attaches great importance to the development of the AI industry. The various difficulties and doubts encountered by Shanghai in the course of industrial development are also bound to be the difficulties and pain points facing other regions," said Ding Botao. As far as he knows, after the Data Regulations of Shanghai Municipality were introduced last year, other parts of the Yangtze River Delta region are also formulating similar regulations for release. Ding Botao believes that Shanghai’s AI legislation will also lead other regions to follow suit and start relevant industrial legislation work.
Second, Shanghai’s AI legislation sets a demonstrative model for local legislation in the Yangtze River Delta region. "In the process of local legislation, other parts of the Yangtze River Delta region can draw upon the many ideas and measures developed by Shanghai, and even learn from and absorb Shanghai’s specific provisions in light of their local situations."
Third, Shanghai’s AI legislation helps to coordinate the development of the AI industry in the Yangtze River Delta. In its draft regulations, Shanghai has identified the key fields and direction of the development of its AI industry, as well as the key measures to be taken. This provides a reference for other parts of the Yangtze River Delta region to clarify their own positioning for industrial development. At the same time, it also provides a "guide" for other parts of the region to collaborate with Shanghai in developing their AI industry.
"At the beginning of the formulation of its AI regulations, Shanghai paid high attention to the basic concept of regional coordinated development," Chen Jidong, an associate professor at the Law School of Tongji University School and a research professor of the Shanghai Collaborative Innovation Center of Artificial Intelligence Social Governance, told the reporter, "I believe that Shanghai's AI legislation will play a leading and exemplary role not only for the Yangtze River Delta region, but also for other parts of the country."
The authors are Ding Botao, Deputy Director of the Information Research Institute of the Shanghai Academy of Social Sciences, and Chen Jidong, an associate professor at the Law School of Tongji University and a research professor of the Shanghai Collaborative Innovation Center of Artificial Intelligence Social Governance.
Source: 21st Century Business Herald
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