As governments around the world grapple with the challenges of regulating artificial intelligence (AI) and implementing digital identity strategies, many look to the European Union (EU) for guidance. New Zealand is no exception, drawing inspiration from the EU’s AI Act and the EUDI wallet program as it crafts its own regulations and digital transformation initiatives.
Learning from Europe’s Approach to AI Regulation
Dr. Nessa Lynch, a researcher focused on the regulation of emerging technologies, highlights the importance of imposing legal and policy safeguards on AI to protect public data privacy. In an article for Newsroom, she emphasizes that AI’s rapid development has primarily been driven by commercial interests, making it crucial to introduce regulations that prioritize public welfare.
“The EU is the largest single world market and a global standard setter,” Lynch writes. She points out that the EU AI Act serves as product safety legislation aimed at protecting people from harm and promoting trustworthy AI usage. The Act’s risk-based framework categorizes AI applications into different risk levels, with stringent requirements for high-risk uses.
According to Lynch, the EU AI Act will also shape global perceptions of what constitutes unacceptable AI usage, including the prohibition of social scoring, image scraping, emotion recognition, biometric categorization, and predictive policing applications. However, Lynch notes exceptions for law enforcement and national security purposes, which have sparked controversy.
Lynch believes that trust is the stabilizing element in AI regulation. “The EU approach is premised on the idea that where consumers have trust in systems, and confidence in quality, they are more likely to be willing to use AI in the commercial sense and in engaging with public services,” she writes.
For New Zealand, adopting a similar approach means addressing gaps in its regulatory regime that could undermine public trust in AI. Lynch points to New Zealand’s comparatively weak privacy and data protection laws and the lack of transparency around AI usage and misuse prevention.
The Role of Digital Identity in a Digital Economy
Alongside AI regulation, New Zealand is also developing a national strategy for digital identity. The government recently launched the New Zealand Trust Framework Authority to oversee organizations providing digital identity services.
Professor Markus Luczak-Roesch from Te Herenga Waka – Victoria University of Wellington, discusses the broader implications of digital identity in an article for The Conversation. He argues that while digital ID is crucial for accessing and trusting digital services, it must be managed in line with national values and perspectives.
“Digital ID is only one aspect of a wider digital economy. We have to consider more systemically how we develop new digital services and who develops them,” writes Luczak-Roesch. He cautions against relying solely on large tech corporations for managing personal data, advocating instead for models like those in Estonia and Norway, where national data infrastructure aligns with local values.
Luczak-Roesch underscores the importance of minimizing the risks associated with technology developed unethically or embedded with incompatible values. Whether in AI or digital identity, he stresses the need for careful consideration of the principles guiding the digital economy.
Bridging Innovation and Regulation
The challenge for New Zealand, as for many countries, lies in balancing innovation with regulation. AI and digital identity technologies offer tremendous potential for economic and social benefits, but they also pose significant risks that must be managed through robust regulatory frameworks.
By drawing lessons from the EU’s comprehensive AI Act and successful digital identity programs, New Zealand aims to create a regulatory environment that fosters innovation while safeguarding public interests. This involves not only adopting best practices but also tailoring regulations to fit the local context and values.
As the global landscape of AI and digital identity continues to evolve, New Zealand’s efforts to align with international standards while addressing domestic needs will be crucial in building a trustworthy and effective digital economy.
