Regulating Transformative Technology in The Quantum Age: Intellectual Property, Standardization & Sustainable Innovation

Stanford - Vienna Transatlantic Technology Law Forum, Transatlantic Antitrust and IPR Developments, Stanford University, Issue No. 2/2020

New Stanford Law School exponential innovation research article: “Regulating Transformative Technology in The Quantum Age: Intellectual Property, Standardization & Sustainable Innovation”.

By Mauritz Kop

Citation: Kop, Mauritz, Regulating Transformative Technology in The Quantum Age: Intellectual Property, Standardization & Sustainable Innovation (October 7, 2020). Stanford - Vienna Transatlantic Technology Law Forum, Transatlantic Antitrust and IPR Developments, Stanford University, Issue No. 1/2020. Available at SSRN: https://ssrn.com/abstract=3653544

Download the article here: Kop_Regulation Standardization Innovation Quantum Age-Stanford Law

Please find a short abstract below:

Quantum technology has many legal aspects

The behavior of nature at the smallest scale can be strange and counterintuitive. In addition to unique physical characteristics, quantum technology has many legal aspects. In this article, we first explain what quantum technology entails. Next, we discuss implementation and areas of application, including quantum computing, quantum sensing and the quantum internet. Through an interdisciplinary lens, we then focus on intellectual property (IP), standardization, ethical, legal & social aspects (ELSA) as well as horizontal & industry-specific regulation of this transformative technology.

Regulating Transformative Technology in The Quantum Age: Intellectual Property, Standardization & Sustainable Innovation.

The Quantum Age raises many legal questions

The Quantum Age raises many legal questions. For example, which existing legislation applies to quantum technology? What types of IP rights can be vested in the components of a scalable quantum computer? Are there sufficient market-set innovation incentives for the development and dissemination of quantum software and hardware structures? Or is there a need for open source ecosystems, enrichment of the public domain and even democratization of quantum technology? Should we create global quantum safety, security and interoperability standards and make them mandatory in each area of application? In what way can quantum technology enhance artificial intelligence (AI) that is legal, ethical and technically robust?

The article argues that the pervasiveness of quantum technology asks for a holistic view on a regulatory framework, that balances the interests of stakeholders and that of society at large. It demands for an agile legislative system that can adapt quickly to changing circumstances and societal needs.

The Quantum Age raises many legal questions.

Regulating quantum computing, quantum sensing & the quantum internet

How can policy makers realize these objectives and regulate quantum computing, quantum sensing and the quantum internet in a socially responsible manner? Regulation that addresses risks in a proportional manner, whilst optimizing the benefits of this cutting edge technology? Without hindering sustainable innovation, including the apportionment of rights, responsibilities and duties of care? What are the effects of standardization and certification on innovation, intellectual property, competition and market-entrance of quantum-startups?

Governance of quantum & AI hybrids

Moreover, which culturally sensitive ethical issues play a role in these regulations? Would it be a good first step to link the governance of quantum & AI hybrids to the Trustworthy AI principles? Do quantum’s different physical properties call for additional core rules? Is it wise to embed our democratic values into the architecture of quantum systems, by way of Trustworthy Quantum Technology by Design? The article explores possible answers to these tantalizing questions.

Regulating quantum computing, quantum sensing & the quantum internet.

The unique physical characteristics of quantum mechanics

Particles and energy at the subatomic level do not follow the same rules as the objects we can detect around us in our everyday lives. In addition to universal, overarching guiding principles of Trustworthy & Responsible Quantum Technology that are in line with the unique physical characteristics of quantum mechanics, the article advocates a vertical, differentiated industry-specific legislative approach regarding innovation incentives (based on the innovation policy pluralism toolkit) and risks (based on the pyramid of criticality, which should include a definition of high-risk quantum technology applications).

IP overprotection in the field of quantum computing

The article demonstrates that strategically using a mixture of IP rights to maximize the value of the IP portfolio of the quantum computer’s owner, potentially leads to IP protection in perpetuity. Overlapping IP protection regimes can result in unlimited duration of global exclusive exploitation rights for first movers, being a handful of universities and large corporations. The ensuing IP overprotection in the field of quantum computing leads to an unwanted concentration of market power. Overprotection of information causes market barriers and hinders both healthy competition and industry-specific innovation. In this particular case it slows down progress in an important application area of quantum technology, namely quantum computing.

Preparing regulatory and intellectual property strategies for The Quantum Age.

Current intellectual property framework not written with quantum technology in mind

In general, our current intellectual property framework is not written with quantum technology in mind. Intellectual property should be an exception -limited in time and scope- to the rule that information goods can be used for the common good without restraint. Intellectual property cannot incentivize creation, prevent market failure, fix winner-takes-all effects, eliminate free riding and prohibit predatory market behavior at the same time. To encourage fair competition and correct market skewness, antitrust law is the instrument of choice.

Shorter IP protection terms for Quantum and AI infused creations and inventions

The article proposes a solution tailored to the exponential pace of innovation in The Quantum Age, by introducing shorter IP protection durations of 3 to 10 years for Quantum and AI infused creations and inventions. These shorter terms could be made applicable to both the software and the hardware side of things. Clarity about the recommended limited durations of exclusive rights -in combination with compulsory licenses or fixed prized statutory licenses- encourages legal certainty, knowledge dissemination and follow on innovation within the quantum domain. In this light, policy makers should build an innovation architecture that mixes freedom (e.g. access, public domain) and control (e.g. incentive & reward mechanisms).

Trustworthy AI & Quantum Technology by Design. In addition to unique physical characteristics, quantum technology has many legal aspects.

Trustworthy Quantum Technology by Design

Regulating transformative technology in The Quantum Age requires synergetic relationships between legislation, standardization, certification and government institutions. The article suggests that quantum products and services made within the EU or elsewhere in the world should adhere to EU safety and security benchmarks, including not limited to the high technical, legal and ethical standards that reflect Trustworthy quantum technology core values, before they qualify for a CE-marking and are eligible to enter the European markets.

Preparing regulatory and intellectual property strategies for The Quantum Age.

The article concludes that anticipating spectacular advancements in quantum technology, the time is now ripe for governments, research institutions and the markets to prepare regulatory and intellectual property strategies that strike the right balance between safeguarding our fundamental rights & freedoms, our democratic norms & standards, and pursued policy goals that include rapid technology transfer, the free flow of information and the creation of a thriving global quantum ecosystem, whilst encouraging healthy competition and incentivizing sustainable innovation.