AI-Driven Consumer Harm
- IJLLR Journal
- 2 hours ago
- 1 min read
Chahak Jain, BA LLB (Hons.), Manipal University Jaipur
ABSTRACT
The framework for consumer protection in India is fundamentally unfit to deal with the problems presented by artificial intelligence technology. There is a lack of transparency about algorithms, which gives rise to a major problem of accountability. Consumers have no awareness about how certain decisions, such as price setting, among others, were made by AI. Not only does the absence of knowledge of the decision-making process make it difficult for consumers to contest any decision, but it also makes it difficult for regulatory agencies, as they have no knowledge of the decision-making process.
No less important is the fragmented character of the regulatory regime. Harm created through the use of AI does not fit into the spheres of consumer, data, or competition regulation. Instead, it overlaps with these areas. The lack of a holistic approach leads to the overlap of competencies and regulation loopholes that impede addressing systemic threats. Ultimately, such a state of affairs leads to the deterioration of the legal system's ability to address technological threats.
Lastly, the regulation is normatively outmoded. It still operates under the assumption that consumers make decisions rationally, while, in reality, they are subject to manipulation. Unless the regulation addresses systemic rather than individual concerns, it will fail to be relevant in modern digital markets.
