Lords urge regulators to evolve as digital change accelerates

Regulators, government and Parliament must evolve their approaches to digital regulation to handle emerging challenges deriving from the advances in technologies, according to a report.

Artificial intelligence (AI) systems and other platforms based on novel approaches are not rigorous or accountable enough to address regulatory gaps and overlaps, according to the report Digital regulation: joined-up and accountable, released on 13 December by the House of Lords Communications and Digital Committee.

The report follows an inquiry into the effectiveness of digital regulation and a call for evidence launched in September 2021. The regulatory system is insufficiently equipped to confront persistent challenges new technologies are presenting, according to committee chair Lord Gilbert of Panteg.

Gilbert noted that more resources and a joined-up approach is something the Lords have been calling for since 2019. That year, the Lords published the report Regulating in a digital world, which approached the shortcomings of the existing regulatory system to deal with the challenges posed by rapid technological development.

Better processes and cooperation between regulators, industry and experts are needed to deal with these advances while minimising both risks of harms and unnecessary regulatory burdens that limit the benefits of tech advances, the report said.

“Sharing information between regulators, advisory bodies, government, industry and experts needs to be enhanced to avoid duplication and ensure that the greatest range of perspectives feed into regulation,” Gilbert noted.

While welcoming the launch of the new Digital Regulation Co-operation Forum (DRCF), the committee noted this is “a small step” and that an overarching coordination and oversight of regulatory objectives remains. More measures need to be introduced to boost the DRCF's long-term effectiveness and accountability, the report said, and coordination needs to be extended and formalised.

Despite the cooperative work carried out by the DRCF so far, the Lords report said the new forum “lacks robust systems to coordinate objectives and to sort out potential conflicts between different regulators as the workload expands”.

“Having clearer mechanisms to rationalise these conflicts would provide greater certainty for industry, making regulation more predictable and conducive to innovation,” the report said, adding that the UK can be a world-leading centre for tech investments through regulating more effectively, not less.

Still on recommendations relating to the DRCF, the report argued that the forum requires statutory measures such making it the Digital Regulation Board. Independent non-executive members should be appointed for this board, the report added, including an independent chair.

The Lords committee chair noted there is a concern that “not all regulators with digital interests and expertise have a seat at the table”, and want to see a new committee of MPs and peers set up to oversee digital regulation.

“Information sharing between all relevant regulators, advisory bodies, the government, industry and academia needs to be enhanced to avoid duplication of work and ensure that the greatest range of perspectives feed into regulation,” the report noted. The committee supports the view that regulators should also be able to share their powers and jointly regulate when appropriate.

Moreover, the Lords report said Parliament needs to pay sustained attention to the topic of digital regulation, to ensure they regulators have the power they need to address complex and evolving challenges, but do so in an appropriate and effective manner.

The point of cooperative between regulators’ disparate but interlinked regimes was made by the UK’s information commissioner earlier in the year. Giving evidence to the  joint Online Safety Bill committee, in September 2021, Elizabeth Denham said government should take the overlap of regulators' obligations into account, and design information sharing approaches accordingly.

While acknowledging that several committees touch on digital-related issues, no single committee specifically looks at digital regulation within government and the private sector.

“Given the pace of technological change and its impact across society and the economy, there is a notable gap in Parliamentary oversight,” Gilbert said. The report recommends that a joint committee of Parliament should be appointed to scrutinise digital regulation.