If a software program which purports to be an early form of A.I. malfunctions, who is liable?
The CCA provides that any producer shall be liable for the damage caused by a defect in his product. The term ‘producer’ has several meanings assigned to it by the CCA, including: ‘the manufacturer of a finished or processed product’; ‘manufacturer of a component part’; or any person who imports into an EEA State a product for sale, hire, leasing or any other form of distribution, where the product is manufactured or produced outside a Member State. The injured party shall solely be required to prove the damage, defect and causal link between the defect and damage and shall not be required to prove fault on the producer’s part. A supplier may be deemed to be a producer in the event that the producer or the importer of an imported product cannot be identified and the supplier fails to answer the injured party’s request to provide the identity and full address of the producer in question, within the stipulated time period.
When the liability is a question between the software provider and a purchasing party, the allocation of liability would primarily depend on the contract between these parties and/or mandatory consumer protection law, where applicable. If no such regulation exist, is lacking or if the question of liability concerns a third party, the allocation of liability would be decided by either Act no. 27 of 13 May 1988 on the Sale of Goods, non-statutory contract or tort law or otherwise applicable laws and regulations.
The choice of applicable law depends on how the software was provided, how and when the malfunction manifested itself, the consequences of said malfunction and an assessment of the respective parties’ degree of culpability.
For instance, if a company or consumer purchased the software on a physical disk, the Sale of Goods Act or Act no. 34 of 21 June 2002 on Consumer Protection would usually apply. Under these Acts, software malfunctions would normally constitute a defect that could give grounds for the purchasing party’s claims of repair, replacement or price reduction etc. While compensation may also be claimed in such instances, the aforementioned acts disclaims indirect losses as unallowable.
While there is no specific legislation as to A.I. in Turkish Law, the owner and the producer of the software program would be held liable by applying “strict liability” rules under the Turkish Code of Obligations through analogy.