Bridging Law and Technology

My dear law students,

To paraphrase Dickens, this is the best of times, this is the worst of times. Just in the last one year we have had an issuance of rules on personal data protection, digital media and OTTs, geospatial technology, drones, payment gateways and payment aggregators.

In the meantime, Australia has introduced some radical revenue sharing arrangements for social media intermediaries.

On top of this, the RBI has suggested some regulatory sandboxes for fin-tech innovations. As a law student and a law academic, there is no better time to understand the relationship between law and technology.

At the same time, the law curriculum is woefully inadequate in exploring this relationship. There is in fact no attempt made so far anywhere in India to embed technology related issues systematically in the law curriculum.

The world is changing and law is playing catch up. In this letter, I will summarise the changing business and regulatory landscape and will draw out the implications for legal education. Today, more than ever, the engine of the global economy is information.

Human flourishing, dependent in the past on farming and manufacturing, has come to rest on the anvil of data.  It does not mean the rest of the economy is irrelevant, but that information is dominant.

Like any other domain mediated by humans, there are good and bad aspects of the digital economy. The digital economy encourages people to be creative (YouTube, streaming platforms), intellectual (google scholar, SSRN network), efficient (Uber), safe (encryption) and even empathetic (Facebook groups).

However, criminals can use the tools of the digital economy to commit fraud or steal information, bully or groom vulnerable people, share abusive texts, images and video, and transmit information that aids or organises violent and terrorist activities.

The law has various ways to encourage the good part of the digital economy. For example, the Information Technology Act 2000 has facilitated electronic commerce by legitimising electronic contracts.

But the focus of the law has mainly been on how to manage the more unsavoury aspects of the digital economy.

More recently the law has even tried to manage the economic fallout of digital economy, as evidenced in the Australian revenue sharing legislation.

Lawyers are famously impervious to change, and legal education follows in the footsteps of the law. For the last twenty years, legal education has underestimated the importance of information technology.

How can legal education respond to the digital economy?

First, digital economy has to be embedded in all of our courses, not just offered as stand alone elective courses. Contract law must discuss, in detail, digital contracts and smart contracts.

The postal rule is great fun, but we must move beyond that. Tort law must discuss negligence in the age of drones and driverless vehicles.

Property law must ask who owns and who must own data in its various forms? Constitutional law must spend as much time discussing human rights issues arising out of digital surveillance, bio-technology, digital media and OTT rules as much as it does on passport impounding issues in Maneka Gandhi.

The manner in which corporate law is taught has to change. Corporate law as it is taught today in law schools is focussed on the Companies Act.

But the real bite, especially when it come to regulation of tech businesses, lies in the rules issued under the Companies Act, the RBI guidance , the FEMA regulations and SEBI guidelines.

One can’t study all the details of these regulations in a single course but students must be introduced to the broader regulatory regime in all its interlocking complexity, not piecemeal is it is done now in law schools.

The concept of a regulatory sandbox should be something about which every law student must have some basic awareness.

Finally, students must come to understand the philosophy begins technological innovation, in order to understand the law regulating it.

Today, there is a bill pending in the parliament that intends to ban private cryptocurrencies.

How does a law student understand cryptocurrencies?

He or she has to first understand the idea of distributed ledgers, block chains and mining. There is an interesting philosophy of using technology and mathematics to build trust (or to sidestep it) that is at the heart of cryptocurrencies.

Unless law students are motivated to understand the philosophical basis of technological innovations, they will adapt a transactional view of technology, and this will kill rather than kindle their interest in technology law.

There is no point teaching a student about data protection law with the sole view of making him or her a data protection officer at a company.

There is even less point in extolling the virtues of artificial intelligence and machine learning unless the students understand the scientific and mathematical concepts at the heart of these new fangled topics.

Let’s not underestimate the resistance of law students to change. When I introduced courses on mathematic economics and excel spreadsheets to law students, I received a chorus of protests usually reserved for human rights violations. But we must persist (and insist); otherwise law students will soon be left adrift in the new world.

The concepts at use in technology led businesses require the law teacher to engage with accounting principles, banking rules and numbers.

The law teacher has to involve accountants, money managers and mathematicians in his class. The law and technology curriculum must celebrate this challenge, not ignore it.

Law schools must put in processes such that teachers from other disciplines are mentored to teach law students keeping in mind that much of the language that other disciplines routinely apply will make little sense to the typical law student. Consider the Bitcoin white paper written by Satoshi Nakamoto.

It introduces an entirely new way of looking at currency transactions. It marks a radical change from previous approaches to banking. But it is written for techies.

Law schools will need teachers who can translate technological, business and mathematical ideas into plain English that lawyers can understand. I am aware of the irony here but lawyers are also subject to Karma.

They made things incomprehensible to others and today the technology world speaks in a language that lawyers struggle to understand.

Dean

School of Law

BML Munjal University