Legal, Ethical, and Regulatory Frameworks

[rahulrazdan][✓ rahulrazdan, 2025-06-16]

In society, products operate within the confines of a legal governance structure. The legal governance structure is one of the great inventions of civilization and its primary role is to funnel disputes from unstructured expression and perhaps even violence to the domain of courts (figure 1). To be effective, legal governance structures must be perceived as fair and predictable. The objective of fairness is obtained by a number of methods such as due process procedures, transparency and public proceedings, and Neutral decision-makers (judges, juries, arbitrators). The objective of predictability is achieved by the use of the concept of precedence.

Figure 1

Whatever value products provide to their consumers is weighed against the potential harm caused by the product, and leads to the concept of legal product liability. While laws diverge across various geographies, the fundamental tenets have key elements of expectation and harm. Expectation as judged by “reasonable behavior given a totality of the facts” attaches liability. As an example, the clear expectation is that if you stand in front of a train, it cannot stop instantly while this is not the expectation for most autonomous driving situations. Harm is another key concept where AI recommendation systems for movies are not held to the same standards as autonomous vehicles. The governance framework for liability is mechanically developed through legislative actions and associated regulations. The framework is tested in the court system under the particular circumstances or facts of the case. To provide stability to the system, the database of cases and decisions are viewed as a whole under the concept of precedence. Clarification on legal points is set by the appellate legal system where arguments on the application of the law are decided what sets precedence.