European Parliament wants to strengthen consumer protection

SW – 02/2020

The European Parliament is seeking a common EU approach to the development of automated decision-making processes in order to reap the benefits of these processes while avoiding risks and the fragmentation of the internal market in terms of regulation. In its Resolution on ‘Automated decision-making processes: Ensuring consumer protection, and free movement of goods and services’, MEPs have called for consumer rights to be strengthened and to ensure that final and permanent automated decisions are subject to human review.

Consumer trust

The European Parliament welcomes the potential of automated decision-making, but believes that when consumers interact with such a system, they must be properly informed about how the system works, how to contact a person with decision-making powers, and how to review and correct decisions made by the system.

In line with the recommendations put forward by the Commission’s Expert Group in its Ethics Guidelines for Trustworthy Artificial Intelligence (AI), Parliament is thus placing emphasis on human control and, where appropriate, final decision-making. The Commission is called upon to examine whether regulatory gaps exist and whether measures are needed beyond existing regulations to protect consumer rights in connection with AI and automated decision-making.

Automated decision-making in social security

The issue of trust in automated decisions and their monitoring could also become increasingly important in future processing by social security institutions. For example, since autumn 2019 the Swiss accident insurance system has been testing partially automated processes to identify claims that meet the definition of an accident under Swiss law.

In addition, automated decisions will also have an impact on the safety of machines and human-machine interactions, and thus on prevention issues in the workplace.

Safety when using machines

The European Parliament points out that products with automated decision-making capabilities can evolve and ‘act’ in ways that were not foreseen when they were first placed on the market.

The Commission is called upon to put forward proposals to adapt safety rules for a number of specific European product safety regulations, such as the Machinery Directive, as well as for ‘non-harmonised products’ covered by the General Product Safety Directive. MEPs want to protect users and consumers from harm and provide manufacturers with clarity about their obligations.

The European Parliament considers that a risk-based regulatory approach is necessary, given the complexity of the various applications of AI and automated decision-making systems. In a report commissioned by the German government, the German Data Ethics Commission also recommends a risk-adapted regulatory approach for algorithmic systems. According to the Data Ethics Commission, this should be based on the principle that the greater the potential for harm, the more stringent requirements and intervention by regulatory instruments must be. In assessing the potential for harm, the entire socio-technical system must be taken into consideration, that is, all components of an algorithmic application including all people involved, from the development phase (e.g. with regard to the training data used) through to its implementation in an application environment and its assessment and any necessary adjustments.

MEPs are calling on the Commission to develop a risk assessment system for AI and automated decision-making to ensure a consistent approach to the enforcement of product safety rules in the internal market.

Next steps

As announced in its Work Programme, on 19 February 2020 the Commission presented a White Paper on developing and utilising AI, while also ensuring full respect for European values and fundamental rights. AI could help to find new solutions to old problems and speed up a wide range of different work processes. However, this requires an ecosystem of trust to ensure it develops within clearly defined ethical boundaries. At the same time, it launched a public consultation on the White Paper. Interested parties can participate until 19 May 2020.