JAPAN Trends and Developments Contributed by: Kenji Tosaki, Hiroki Tajima and Chie Komiya, Nagashima Ohno & Tsunematsu
In addition, the Report states that if generation and use of AI output data constitute copyright infringement, not only the AI User but also the AI developer or the AI service provider can be held liable for copyright infringement. The likelihood that the AI developer or the AI service provider will be held liable for copyright infringement will increase in the following situations: • infringing output data is very frequently cre - ated when a specific generative AI is used; and/or • the business operator does not take meas - ures to avoid generation of output data that is similar to existing copyrighted works, even though it recognises there is a strong pos - sibility that the generative AI will create such output data. Governing law With respect to the geographic coverage of the Copyright Act, the Report states that (i) as to damage claims, where the result of the copy - right infringement is deemed to have occurred in Japan, Japanese copyright law will apply (as the law of the place where the result of the act in issue occurred); and (ii) as to claims seeking injunctive relief, Japanese copyright law, as the law of the country where protection is claimed, will govern where the act of exploitation is deemed to have taken place in Japan. The Report states that the following factors will increase the possibility that Japanese copyright law will apply: • in the course of the development/training of generative AI, the program collecting data for training AI ran on a server located in Japan, and existing copyrighted works were repro - duced in connection therewith;
• where output data, which included existing copyrighted works, was produced by genera - tive AI running on a server located in Japan; or • where output data which included copyright - ed works was produced by generative AI and publicly transmitted to users in Japan by an AI service provider. Interim Report of the Study Group on Intellectual Property Rights in the AI Era (May 2024) In October 2023, the Study Group on Intellectual Property Rights in the AI Era (the “Study Group”) was convened. The Study Group organised dis - cussions regarding the relationship between AI and intellectual property rights, based on considerations of this in relevant ministries and agencies, to consider necessary measures, etc. The Study Group mainly discussed and consid - ered the following two issues: (i) measures with respect to concerns and risks regarding genera - tive AI and intellectual property; and (ii) the pro - tection of inventions based on developments in AI technology. In May 2024, following discussion of the fore - going issues, the Interim Report of the Study Group on Intellectual Property Rights in the AI Era (the “Interim Report”) was published. The Interim Report is not legally binding or a defini - tive legal assessment. The Interim Report does, however, set out the results of these discussions based on considerations in the relevant minis - tries and agencies, concerning various issues related to generative AI and IP rights. Therefore, the Interim Report is a valuable resource for par - ties engaged in businesses related to generative AI in Japan. The Interim Report states that: (i) the Intellectual Property Act; (ii) technology; and (iii) the contract
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