By Gregg Anderson, VisionQuest

It’s common knowledge that most modern Western governments can be exceedingly slow when it comes to implementing new legislation. This is particularly true in the Cayman Islands, and especially as of late.

As with the emergence of the telephone, the car, the radio and TV, the spread of technological innovation has gotten far ahead of case law.

Maybe more significantly, though, is that current democracy was never devised to move swiftly in the first instance. Democratic legislation, particularly the Westminster model, was premeditated to be methodical, resolute and unhurried.

The case for slow-moving government was initially so that discussions could continue when contentious issues surfaced. After all, in order to successfully represent all people, those people must be given airtime.

Yet while this was certainly a lawful virtue to governments and legislation moving at a turtle’s pace at the time, current enhancements in technology – which simply could not have been foreseen by Cayman’s legislators in prior times – are disputably making that model archaic.

But the fact remains that it’s no longer the 19th century. It’s 2016, and we know by now that technological progress creates more technological progress. We recognize that governments need to be more agile than ever before to stay abreast with what’s become an exceptionally vibrant financial panorama.

Regrettably, though, at a time when technological advance is ubiquitous, our government remains unhurried. In many cases, technology has begun to overtake its ability to regulate.

Given the speed of development in the tech industry – especially in machine learning and artificial intelligence – hardware and software likely will soon outstrip the law in other areas, too.

A disruptive service can be created by a couple of nerds with laptops or tablets, but new laws are born within the scowl of unhurried bureaucracy. And, it takes much time for lawmakers to catch up. Several services are caught in the gap between the two schedules.

Take the following three examples:

Electric cars

Despite the global growing acceptance of electric vehicles permitted to drive on public roads, it took seven years for the traffic regulations allowing electric vehicles to operate on the roads of the Cayman Islands to have been approved by Cabinet in August 2012. Kudos to John Felder for his persistence.

Among the concerns were safety per Vehicle Licensing Director David Dixon, and “the registration and licensing of vehicles was an intricate process and required extensive research on many issues,” per the then Deputy Premier Juliana O’Connor-Connolly.

Driverless vehicles are in the pipeline, but one should not anticipate them being on Cayman’s roads any time soon.

Drones

These unmanned aerial vehicles (UAVs) are now deployed in Cayman’s airspace by children, entrepreneurs and hobbyists. Recently, the Civil Aviation Authority of the Cayman Islands issued new restrictions prohibiting users of small-unmanned aircraft, aka drones, from flying the vehicles near the islands’ airports and the prison.

The main concern is that drones can interfere with airports and security. Individuals who violate the new rules will face prosecution and, if convicted, could be fined up to $6,000 or imprisoned for up to two years.

Furthermore, drones pose a unique threat to privacy, as small, unmanned drones are already inexpensive, and their surveillance capabilities are rapidly evolving. Thus legal and privacy issues are two very important topics that need attention as drone use becomes more popular and commonplace.

Privacy has rapidly become the No. 1 concern among all interests when it comes to drones, especially the ones designed to blend into surroundings. And especially the ones not available to the public are of most concern to lawmakers, special interested groups and private citizens.

Is there anything on our lawmakers’ radar screens about how to deal with this issue? Is the pending Data Protection Law taking this into account? Will it take a similar incident as that where it took a drone literally landing on the lawn of the White House last year for President Obama to start talking about drone regulation?

If someone were hurt on an aircraft or in some other accident caused by a drone, its owner is clearly liable. Or is he/she? And considering that drones aren’t insured vehicles, how would the victims be compensated?

This is why a debate about technology and the law should cover not just important constitutional questions, but also more mundane things like insurance liability.

Airbnb

Peer-to-peer room renting service Airbnb has also created a new category that lacks straightforward legislation.

Late last year, the Hotel Licensing Board clarified that it expects property owners offering the service to pay the same 13 percent tax hotels pay, something they had not been doing.

Property owners must also register, get a trade and business license to rent their rooms, and satisfy requirements that meet health and safety, fire, security and certain accommodation standards, such as the quality of window coverings and furnishings and the maintenance of the buildings. Penalties may include fines or other enforcement.

In addition to legislative inertia, the requirements for liability insurance, building and housing standards, record-keeping, reporting, safety issues etc., could all be show stoppers for this nascent industry.

The relationship between innovation and laws has always been this way. Vehicle sales in the United States preceded the country’s first speed limit for years. And airlines were already selling tickets to civilians by the time the first Air Commerce Act of 1926 was passed.

Mostly, policymakers do not understand modern technology very well, and they’re not anticipating technological disruptions in society. There should be groups dedicated to visualizing all the diverse scenarios that could arise, as is done in the intelligence community, because there will be disruptions, and privacy alone is worth safeguarding.

Unless we want to leave a wide range of legal questions unaddressed, lawmakers should begin to draft legislation that defines the rights and liabilities being created for citizens by the spread of intelligent machines.

About the author: Gregg Anderson is managing director of VisionQuest Management Services Ltd., a boutique management consulting company that provides independent directorships, business, strategy, governance, risk and compliance consulting services.

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