As Artificial Intelligence (AI) continues to transform the landscape of businesses worldwide, it has become a fundamental component of many recent commercial transactions, including industry acquisitions, business assets or licenses. This trend is set to extend even further as the interest in AI technology intensifies.
For organisations integrating AI into their available services, there are four central considerations to take into account when reaching agreements in commercial transactions. These considerations are pertinent whether such actions involve an investment in AI technology, relate to competitive industries, or deliver services that could be revolutionised by AI. Detailed guidance on this subject has been offered by experts at Procopio, Cory, Hargreaves & Savitch LLP.
- Firstly, it is recommended that parties involved in the transaction gain an understanding of the technology, its functionality, and its potential benefits. This includes studying the AI’s effectiveness in spearheading transformative changes in services or gaining a strategic advantage in the industry.
- Secondly, the implications of AI in the legal and regulatory frameworks should be given prominent consideration, including aspects such as privacy, cybersecurity, and intellectual property rights.
- Another factor to consider involves the potential risks and uncertainties that come with AI. Parties should examine the inherent unpredictability of technology, and how it may impact the value of the transaction.
- Finally, the parties must meticulously consider the allocation of these risks between the parties. In order to ensure a balanced and fair agreement, proper evaluation of these risks is paramount.
As AI technology achieves a greater degree of sophistication and applicability in diverse industries, comprehensive understanding and prudent risk management are critical in achieving successful commercial AI transactions. It is expected that as organisations and legal professionals adapt to these evolving conditions, AI will redefine the future of commercial transactions.