The Evolution of the UK Online Safety Bill: What’s Next?

Posted in Data Protection

The bill has been introduced into the UK’s Parliament with various amendments to the initial draft published in May 2021, reflecting the extensive feedback received and the challenges in reaching a consensus.

By Gail Crawford, Deborah Kirk, Elva Cullen, Alain Traill, and Victoria Wan

In March 2022, the UK government formally introduced the amended Online Safety Bill into Parliament (the Bill). The Bill features a number of substantial amendments to the government’s initial draft of the Online Safety Bill published in May 2021 (the Draft Bill), as explored below. For background on the broader development of the Online Safety Bill, see Latham & Watkins’ blog series, including a post summarising the Draft Bill. Continue Reading

UK Economic Crime Bill to Reform Companies House

Posted in Cryptoassets

The UK government is taking further measures to tackle economic crime in the UK, reforming its corporate register, and giving extra powers to the Serious Fraud Office.

By Stuart Alford KC, Clare Nida, and Mair Williams

The UK has published the new Economic Crime and Corporate Transparency Bill 2022 (the Bill), which focuses on reforms to Companies House, the role of limited partnerships, seizure of suspected criminal cryptoassets, and new intelligence gathering powers for law enforcement.

In March 2022, the Economic Crime (Transparency and Enforcement) Act 2022 (the Act) created a new register of overseas entities holding UK property assets alongside changes to the unexplained wealth order and sanctions regimes (see previous Latham blog). The Act was passed in response to the Russian invasion of Ukraine and targeted Russian assets held or flowing through the UK. At the time of the Act in March, the UK government said a second part would follow, and the Bill, published in September 2022, sets out the plans for that second part. Continue Reading

Reducing Socioeconomic Bias in the UK Financial Services Sector: Emerging Best Practice

Posted in Employment and Benefits, ESG, Finance and Capital Markets

The Financial Services Skills Commission has issued an insight paper outlining how companies can collect and evaluate data on employees’ socioeconomic backgrounds.

By David Berman, Nicola Higgs, Rob Moulton, and Dianne Bell

Socioeconomic backgrounds of employees and socioeconomic diversity at senior levels across the UK financial services industry is beginning to feature more prominently in diversity and inclusion (D&I) discussions. Several government and industry taskforces and studies conducted on the issue of social mobility and class advantages/disadvantages have revealed striking impacts of this bias within the UK financial services sector. Not only is the sector significantly reliant on individuals from higher socioeconomic backgrounds at the leadership level, but the studies also indicate that employees from working class or lower socioeconomic backgrounds are held back in a number of ways (which may lead to their eventual departure from the sector).

  • Progression gap: Employees from working class or lower socioeconomic backgrounds progress 25% slower than peers despite no difference in job performance, and they find conforming to the dominant cultures “exhausting” and this impacts on their individual performances.
  • Pay gap: A class pay gap of £17,500 appears to exist in financial services (compared with £5,000 in the technology sector).
  • Opportunities to upskill talent: Findings suggest that individuals from lower socioeconomic backgrounds are less likely to sign up for training opportunities.

From a regulatory perspective, this lack of diversity at the senior level impacts the culture of a firm, raising concerns around, for example, groupthink and its impacts on effective decision-making.

Continue Reading

The UK’s AI Strategy: Where Are We Now?

Posted in Emerging Companies and Technology

The UK government and regulators have taken several steps to implement a 10-year strategy published last year outlining the government’s pro-innovation national approach to AI.

By Deborah J. Kirk, Laura Holden, Nara Yoo, and Amy Smyth

The UK Department of Digital, Culture, Media and Sport (DCMS) published its 10-year National AI Strategy for the regulation and promotion of artificial intelligence (AI) in the UK (Report). DCMS seeks to build “the most pro-innovation regulatory environment in the world” and vows to make the UK the “best place to live and work with AI” over the next decade.

The UK government is clearly keen to recognise the opportunities that AI offers, particularly in a post-Brexit world in which the UK has more flexibility to position itself as a pro-innovation regulatory environment and a favourable place to live and work with AI. The Report provides a roadmap of future regulatory developments, and context for companies seeking to understand the practical impacts of this rapidly developing and far-reaching landscape.

Read Latham’s article on how this strategy is shaping the current AI regulatory landscape in the UK.

Latest Developments in Controversial Article 17 on Platform Liability for Infringing Content

Posted in Copyright

A year on from the national implementation deadline of the Directive on copyright in the Digital Single Market, the CJEU has upheld controversial Article 17.

By Deborah Kirk, Elva Cullen, Victoria Wan, and Amy Smyth

In September 2016, the European Commission announced its proposal on “the modernisation of copyright” designed to bring “clearer rules for all online players”. Six years later, in September 2022, and following a national transposition deadline of 7 June 2021, the EU Directive on copyright and related rights in the Digital Single Market 2019/790 (the Directive) is not yet fully implemented across all EU Member States. Continue Reading

UK to Open Up Text and Data Mining Under New Copyright and Database Rules

Posted in Data Protection

A proposed broad copyright exception for text and data mining that favours AI developers is unlikely to be welcome news for rightholders.

By Deborah Kirk and Brett Shandler

On 28 June 2022, the UK government published its response to its consultation on “Artificial Intelligence and IP: Copyright and Patents”, which commenced in October 2021 (Response).

Among other points,[1] the government has indicated its intention to introduce a new copyright and database exception that allows text and data mining (TDM) for any purpose, provided that the party employing TDM obtains lawful access to the material. Continue Reading

Navigating Sanctions in M&A: Seven Questions for Deal Teams to Consider

Posted in M&A and Private Equity

M&A deal teams face complicated legal issues amidst rapidly changing global sanctions and guidance.

By Richard Butterwick, Les P. Carnegie, Charles Claypoole, Beatrice Lo, Mikhail Turetsky, Andrew P. Galdes, Ruchi G. Gill, Thomas F. Lane, and Catherine Campbell

Russia’s invasion of Ukraine has created new headwinds for M&A dealmakers, as a complicated matrix of sanctions and export controls poses legal challenges for both buyers and sellers, as well as transaction targets. With sanctions regimes becoming ever more complex, deal planning and execution requires expert legal counsel and skillful navigation. Continue Reading

UK High Court Ruling in Competition Claim Highlights Consequences of Disclosure Failures

Posted in Litigation

The ruling is also a reminder of the circumstances in which the court may order indemnity costs for such failures.

By Oliver Browne, Hayley Pizzey, and Anna Kullmann

On 29 July 2022, the UK High Court ruled in Cabo Concepts Limited v. MGA Entertainment (UK) Limited that toy manufacturer MGA should pay hefty costs for failure to conduct proper pre-trial disclosure. Continue Reading

UK’s “Smarter Contracts” Landscape Offers Robust Foundation for Commercial Use

Posted in Blockchain, Cryptoassets

The latest analysis of “smarter contracts” provides helpful guidance on the opportunities and potential legal and practical risks in adopting these technologies.

By Christian F. McDermott, Andrew C. Moyle, and Nara Yoo

LawtechUK’s latest analysis of so-called smarter contracts in the UK, set out in its Smarter Contracts Report (the Report), seeks to identify how technology is transforming contract practices, and to explore future opportunities and innovation. The Report defines a “smarter contract” as a legally binding digital contract, including legally enforceable contracts in which some or all of the terms are represented in code, and identifies a range of smart contract applications, from simple electronic signatures to sophisticated self-executing contracts. Continue Reading

Green Power and the Protections of Intra-EU Energy Investment

Posted in Dispute Resolution

The tribunal in Green Power v. Kingdom of Spain declined jurisdiction, finding that the parties had not validly consented to arbitration under the Energy Charter Treaty.

By Dr. Sebastian Seelmann-Eggebert, Shreya Ramesh, and Ram Mashru

A tribunal seated in Sweden has become the first to uphold the “intra-EU objection” in an arbitration under the Energy Charter Treaty (ECT) administered by the Stockholm Chamber of Commerce. The tribunal found that it lacked jurisdiction to hear a dispute between two Danish solar energy investors — Green Power and SCE (the Claimants) — and the Kingdom of Spain on the basis that Spain’s standing offer to arbitrate under Article 26 of the ECT was invalid as a matter of EU law. The unprecedented decision gives effect to a series of seminal judgments of the EU Court of Justice (CJEU) which held that intra-EU investment arbitrations are incompatible with the primacy of EU law and the unity of the EU legal order. Continue Reading