2023 Outlook on IP and Data

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Reform on the horizon 

While the Data Protection and Digital Information Bill (“the Bill”) – aimed at amending the UK’s data protection regime) may have been paused in October 2022 as a result of a government reshuffle, new life may be breathed into it yet.  

The Bill is currently stuck at its second reading in the House of Commons, but it’s entirely possible that (perhaps after a substantial rewrite), the Bill will progress into law over the next year.  

Although the proposals contained within the Bill may change throughout the legislative process, in its current form, it contains a package of reforms aimed at reducing the burdens businesses face. These include the creation of a data protection framework that is focused on privacy outcomes rather than ‘box-ticking’, and providing a clearer regulatory environment aimed at driving responsible innovation and scientific progress. 

According to the Department for Digital, Culture, Media and Sport (DCMS) the reforms will create over £1 billion in business savings over ten years.  

Outside of data reform, this year may also be the year for a flurry of adequacy decisions, which allow for the free flow of data between countries.  

With the categorisation of the US as a “priority destination” for the UK, it’s a seemingly safe bet that this data bridge will be implemented. Transfers between the EU and US are also set to be finalised in mid-2023, although multiple levels of review stand between the draft and final approval.  

A closer regulatory eye on companies is also to be expected over the next 12 months. 2022 saw sky-high fines for companies that had breached data regulations and 2023 is expected to follow suit.  

Already this year, the Irish Data Protection Commissioner has issued higher fines against Facebook and Instagram than it had originally imposed, following instruction from Europe’s privacy regulator. Now, Meta-owned Facebook and Instagram face fines of €210 million and €180 million respectively (up from a maximum of €36 and €23 million in the draft decisions).  


AI and ownership 

Can an artificial intelligence (AI) invent a patent? That’s the question the UK Supreme Court will have to address later this year or in 2024.  

DABUS, the AI at the heart of the story, was created by scientist Stephen Thaler. Over the past few years, Thaler has filed numerous patent applications for inventions allegedly invented by DABUS. On each of the applications, he indicated that “DABUS” was the sole inventor, and that “the invention was autonomously generated by an artificial intelligence”. 

Thaler’s bid has been met with nearly unanimous rejection across the globe so far, with the exception of South Africa (although the examination procedure there is a check on basic formalities, rather than a substantive examination).  

After a series of rejections, there remains a glimmer of hope in the UK. Thaler has made it to the Supreme Court. Outside of the obvious repercussions of a decision either way, the attempts have also sparked conversation. 

IP offices, courts and policymakers are going to need to look at the legislative frameworks that underpin patent protection and figure out if they’re adequate to deal with an AI ‘inventing’ world. Whilst the UK is not planning to change patent law now, it’s keeping the area under review.  

Aside from the patent question, the ongoing development of AI is also driving increasing scrutiny. The EU Parliament is expected to vote on the draft EU Artificial Intelligence Act, which aims to introduce a common regulatory and legal framework for AI, in March.  

Meanwhile, the UK has published proposals on regulating AI in a “proportionate, light-touch and forward-looking” way, although the results of the consultation on this are yet to be published.


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