David Quest KC Chairs FMLC Working Group on Private Law Issues in AI

On Monday 27 October, the Financial Markets Law Committee (FMLC) published a paper examining Private Law Issues in Artificial Intelligence. David Quest KC chaired the working group responsible for producing this paper.

The FMLC’s role is to identify issues of legal uncertainty in the framework of the wholesale financial markets that may give rise to material risks and to consider how such issues should be addressed. This paper explores how English private law applies to the use of artificial intelligence in financial markets – a rapidly evolving area following the emergence of large language models and other advanced AI systems.

The paper concludes that while AI presents novel practical and ethical challenges, English commercial law is largely “technology neutral” and well-equipped to address them through established legal principles. The report distinguishes between the use of AI as a decision-support tool and its direct deployment in financial transactions, highlighting key questions of responsibility, attribution, and liability.

The working group’s analysis finds that AI systems should be treated as tools rather than legal persons or agents, meaning that organisations deploying them remain responsible for their actions. The paper suggests that English common law already provides a robust framework for resolving disputes involving AI, with regulatory, rather than legislative, measures likely to be the most effective means of addressing any remaining risks.

The full paper is available on the Financial Markets Law Committee website.