DENMARK Trends and Developments Contributed by: Simon Milthers, Thomas Bøgedal Kristiansen, Mikkel Friis Rossa and Emil Steenberg, Bech-Bruun
es. These more flexible tools are a contributing factor to the transition from traditional licence- based models to SaaS/PaaS models. This shift is also driven by the growing impor- tance of AI-based services, which rely heavily on data. Companies that can effectively harness and utilise data are well positioned to thrive in this new area. As a result, M&A activities are like- ly to focus on acquiring companies with strong data capabilities. Emerging technologies When conducting due diligence for special or emerging technologies such as AI, the internet of things (IoT), autonomous driving, and big data, the process generally mirrors that of other technologies from an IP perspective. However, the use of AI introduces unique legal challeng- es, particularly concerning the ownership of IP rights and liability for decisions and damages resulting from AI applications. It is a fundamental principle of Danish copyright law that copyrights are attributed to natural per- sons as authors. Therefore, determining IP rights for works generated through AI involves a spe- cific assessment based on the type of technol- ogy used and the extent of human input. This nuanced evaluation is essential to establish clear ownership and avoid potential disputes. Emerging technologies often come with addi- tional regulatory considerations. By way of example, IoT devices and connected cars may fall under telecommunications regulations sub- jecting the target company to extensive regu- latory obligations. Moreover, buyers in M&A transactions must be vigilant about data pri- vacy risks, especially when the target company employs customer profiling features or utilises new technologies such as generative AI tools or
IoT devices. These technologies can raise sig- nificant data protection concerns that need to be thoroughly examined during the due diligence process. Navigating AI regulations The EU is at the forefront of regulating AI and its rapidly evolving field. The AI Regulation came into effect on 2 August 2024, but the individual rules apply progres- sively, as follows: • 2 August 2024 – the AI Regulation came into effect (20 days after publication in the Official Journal of the EU); • 2 February 2025 – the prohibition on banned AI systems applies; • 2 May 2025 – deadline for the development of codes of practice; • 2 August 2025 – obligations for providers of general-purpose AI models and provisions on sanctions apply; • 2 February 2026 – the EU issues guidelines on classification rules for high-risk systems; • 2 August 2026 – general application of the AI Regulation, including the application of high- risk obligations according to Annex III; and • 2 August 2027 – application of high-risk obli- gations according to Annex I (EU harmonisa- tion legislation). High-risk AI systems, such as autonomous vehi- cles and medical devices, will be subject to rig- orous testing and documentation requirements. The EU AI Act also addresses generative AI (eg, ChatGPT), mandating transparency and meas- ures to prevent the generation of illegal content. The proposed EU AI Act introduces a risk-based framework to regulate AI technologies based on their potential impact on public health, safety
139 CHAMBERS.COM
Powered by FlippingBook