Simont Braun boosts the capabilities of its Fintech and Financial Services practices by welcoming Partner Joan Carette and Senior Associate Jean-Christophe Vercauteren. These strong additions to the firm enhance our Digital Finance Team’s position on top of the Belgian market.
The highly respected Joan Carette joins our Fintech and Financial Services team as a partner next to Catherine Houssa and Philippe De Prez, where she will reinforce our regulation and FinTech skills and allow to improve our focus on the Tech aspect of our expertise.
Joan Carette has 20 years of experience in FinTech, payments, e-money, AML and more generally banking and financial services and the prudential supervision of financial institutions. She worked as a regulator in the prudential supervision department of the FSMA, and in Belgian and international law firms for over 15 years.
Clients admire her “very flexible, pragmatic approach,” as well as her “deep knowledge of financial regulation.” (Chambers & Partners)
“FinTech, Payments and Financial Services play key roles in our economy and require to combine strong legal knowledge with tech-savviness and proactivity. In this context, I am delighted to join the strongest Digital Finance Team on the Belgian legal market. Together, we will be able to offer the best possible guidance to our clients,” says Joan Carette.
Jean-Christophe Vercauteren has solid regulatory expertise in FinTech, payment services and e-money, AML and more generally banking and financial services. He gathered experience as a lawyer in Belgian and international business law firms, and as a legal counsel in a Belgian bank.
“I could not think of a more stimulating environment than Simont Braun’s Digital Finance Team to further develop my expertise. Being part of the pioneer FinTech law firm in Belgium will be a daily motivation, and I am happy to contribute to broadening its capabilities,” says Jean-Christophe.
“We are proud to welcome top talents like Joan and Jean-Christophe in the team. With them on board, our Digital Finance Team strengthens both its financial services and tech capabilities,” adds Philippe De Prez, partner in FinTech and Financial Services.
Simont Braun’s pioneer Digital Finance Team is one of the best and most-qualified teams in Belgium. “The firm has proven itself as one of the very leading players in the market, having advised on groundbreaking projects involving areas such as alternative lending, micro-savings, robo-advisory, blockchain, ICOs and virtual currencies.” Simont Braun is the only law firm ranked in Band 1 in Belgium in FinTech by Chambers & Partners. The firm is also ranked Tier 1 in FinTech by the Legal 500, and Tier 1 in Financial Services Regulatory by IFLR 1000.
We are thrilled to be ranked in the Top Tier in Financial Services Regulatory by the legal guide IFLR 1000, and the only Belgian independent law firm recognised in this category!
Congrats to our hard-working team and thank you for the feedback.
With the generalisation of health-related apps, health and life insurers are keen to use the collected data to improve the accuracy of their insureds’ profiles. This trend raises important questions in terms of privacy but also in terms of risks mutualisation in society.
A bit of context
With the increase of technology and the ability of our smartphones or smartwatches to collect our heartbeats, count our steps, and assess our pace, developers have naturally seen an opportunity to develop health-related apps.
These apps track running performances (Runkeeper, Runtastic, Nike+, Fitbit…), monitor diet (MyFitness Pal…), analyse sleeping habits (Fitbit, Jawbone, isommeilr…), etc.
Citizens are using more and more of these health-related apps in their daily life.
Of course, health and life insurers are greatly interested in the health data collected by these apps. This is not necessarily a bad thing as this can mean that insurers can better assess the risk they insure and its evolution, and request more accurate premiums from their policyholders. Nonetheless, this trend also raises important questions in terms of privacy, but also in terms of insurance paradigm as such.
The privacy issue
The privacy issue is rather obvious. One might reasonably desire to keep certain aspects of one’s life private.
The privacy issue is not limited to the insurance world. Privacy is primarily addressed by the EU General Data Protection Regulation (GDPR). The purpose of this news is not to examine this regime in details. Let us simply remind that under Article 9 of the GDPR, health-related data are considered as “special categories of data”.
The process of this kind of data is subject to higher requirements and may only serve highly valued purposes. The data subject may, however, always give its explicit consent to the use of his/her health-related data (Art. 9, 2, (a) GDPR).
This explicit consent is rather well protected and must be free and genuine. For instance, a service provider may normally not monetise or subject the delivery of its services to the data subjects’ consent.
The segmentation issue
Where do we stand?
The insurance industry is based on the idea of risk mutualisation. This principle can be extremely useful to the operation of a society. In a nutshell, the healthy clients’ premiums pay for the insurance indemnity of the ill insured persons.
Health and life insurers have always tried to assess the risks presented by insured persons with the highest accuracy possible using statistical data. Typically, all things being equal, a young sporty person is less likely to die than and old person suffering from diabetes. This reality will normally result in the young person paying a lower insurance premium.
The division of insured persons in categories (e.g. young and healthy versus old and ill) is called “segmentation”. To each category corresponds a level or premium, certain categories of risk being simply refused by insurers (depending on their risk appetite). This is the reason why health and life insurances are almost systematically subject to a medical questionnaire and, in some cases, a medical examination.
Naturally, the more accurate and detailed the segmentation is, the less insurance services offer a mutualisation of risk to society and – arguably – the less useful become insurance services to society as a whole.
This risk has been identified by the Belgian legislator. One of the main Belgian attempts to avoid the risk of “demutualisation” is embodied in Article 44 of the law of 4 April 2014 relating to insurances. Under this provision “Any segmentation made in terms of acceptance, cost, and/or extent of the insurance cover must be objectively justified by a legitimate purpose, and the means to achieve this purpose must be appropriate and necessary”.
This provision lays down the legislator’s ideal but it is very broad and offers a lot of room for interpretation.
Certain members of Parliament fear that connected devices and health-related apps unduly change the paradigm of mutualisation in the insurance sector.
To prevent this potentiality, they have filed a law proposal with the intention of prohibiting the use by health and life insurers of personal data collected by connected devices. The law proposal further prohibits to subject insurance acceptance, pricing and/or extent of the insurance cover to the use by the insured person of health checkers and the sharing of data collected by such health checkers with insurers.
Practically, if enacted, the law proposal would bring a new Article 44, § 2nd, to the Law Insurances:
“In derogation to Article 43, § 1st, this paragraph applies to the following insurance contracts:
1° Individual life insurance;
2° health insurance […].
No segmentation can be applied to acceptance, pricing and/or extent of the insurance cover subject to the condition that the policyholder accepts to acquire or use a health checker, accepts to share the data collected by the health checker, or subject to the condition that the insurer uses such data. The processing of the personal data collected by a health checker, relating to the way of life or health of the policyholder, is prohibited”.
The concept of “health checker” would be defined in a new Article 5, 53°, of the Law Insurances as “a device allowing the measurement of one or more variables associated to the way of life or the health of the policyholder”.
At the end of January 2020, the Belgian Data Protection Authority (“DPA”) issued an opinion on the law proposal.
The law proposal is primarily based on Article 9.4 of the GDPR, according to which “Member States may maintain or introduce further conditions, including limitations, with regard to the processing of genetic data, biometric data or data concerning health”.
The proposal is further based on abovementioned Article 9, 2, (a) of the GDPR, which provides that special categories of data (such as health-related data) cannot be processed unless “the data subject has given explicit consent to the processing of those personal data for one or more specified purposes, except where Union or Member State law provide that the prohibition […] may not be lifted by the data subject”.
According to the DPA, these two provisions of the GDPR effectively allow the Belgian legislator to introduce additional limitations to the processing of health data so that the law proposal is compliant with the GDPR.
While nothing is (yet?) cast in stone, the discussed law proposal is a perfect illustration of the difficult balance regulators need to strike between innovation and the preservation of existing paradigms.
Interestingly, it shows a strong desire of certain members of Parliament to safeguard the principle of mutualisation of risks in the insurance industry. This mutualisation is often seen as a key principle to the health system as a whole.
The DPA’s opinion is also a good reminder that the GDPR, although an EU regulation, still allows Member States to adopt stricter requirements when it comes to protecting special categories of data. In the case at hand, the law proposal somehow “protects the data subjects from themselves” by revoking their right to agree to certain use of their connected devices.
Leading Belgian law firm Simont Braun takes a step forward into LegalTech with Luminance. This ground-breaking AI application enables legal counsels to review large volumes of documentation with an instant insight into their content, improving and accelerating processes such as due diligence and regulatory compliance reviews.
Simont Braun decided to engage Luminance after a successful two-week pilot trial with the platform. Luminance’s core technology, ‘LITE’ (Legal Inference Transformation Engine), uses a unique combination of supervised and unsupervised machine learning, which enables the user to detect critical information in a massive volume of contracts very efficiently. Luminance is also language and jurisdiction-agnostic, allowing the lawyers to work seamlessly across French, Dutch and English documentation.
Axel Maeterlinck, Corporate / M&A Partner at Simont Braun, comments: “Luminance goes above and beyond other platforms on the market. We can now review an entire set of documents at a glance and, hence, ensure a quicker and more efficient analysis while being sure that nothing has been missed. This is a significant added-value for our clients.”
Emily Foges, Luminance’s CEO, is delighted to have such a forward-thinking firm on board: “Firms are under a lot of pressure to constantly adapt and adhere to their clients’ demands. With Luminance, law firms like Simont Braun can stay ahead of the game by providing the best possible legal representation to their clients.”
In just over three years, Luminance has established itself as the world-leading artificial intelligence platform for the legal profession. Now in use in over 80 languages, Luminance’s flexible machine learning is integral for firms like Simont Braun seeking to innovate their legal services.
About Simont Braun
Simont Braun is an independent business law firm which provides a broad spectrum of legal services, including Corporate / M&A, Banking and (Digital) Finance, Real Estate, Intellectual Property, Dispute Resolution, Tax and Employment Law. Based in Brussels, Simont Braun currently houses 45 lawyers. Simont Braun is recommended by Chambers and Partners and The Legal 500.
Luminance is the leading artificial intelligence platform for the legal profession. Founded by mathematicians from the University of Cambridge, Luminance has developed the Legal Inference Transformation Engine (LITE), the first true application of machine learning to the legal industry, combining pattern-recognition technology with supervised and unsupervised machine learning to read and understand human language. Luminance is used by law firms and in-house teams in over 48countries around the world to improve processes such as due diligence, contract negotiation, regulatory compliance reviews, property portfolio analysis and eDiscovery. The company has offices in London, Cambridge, New York and Singapore.
We have been hearing about autonomous vehicles (“AVs”) for quite a while. However, as time goes by, the use of AVs is getting closer to becoming a reality. In various countries, car manufacturers are now carrying out tests on open or closed parts of public roads. Just like engineers are facing technical challenges in this field, lawyers have to deal with questions around liability, cybersecurity, data protection, insurance, intellectual property, etc. In this framework, news about AVs accidents are getting less and less uncommon, and they lead to tricky liability questions, such as: can a car user be held liable if he or she had no direct control over the wheel?
Such questions might need a clear answer in the near future and the whole AV subject at large is gaining track. Recently, a Belgian politician launched the idea to make Belgium the first country to welcome AVs. In parallel, the European Commission issued in February 2020 a White Paper on Artificial Intelligence, referring to liabilities incurred by AI, and by extension by AVs.
What do you mean, “autonomous” vehicle (“AV”)?
AVs’ autonomy varies in degree. Subject to a specific European scale of autonomy measurement, authors generally refer to the Society of Automotive Engineering (“SAE”)’s scale. SAE is an international organisation based in US. It brings together engineers, CEOs, researchers, professors, and students who share ideas on automotive engineering. It established six levels of autonomy, ranging from a complete human intervention (level 0) to a total absence of human action (level 5).
To date, the most advanced AVs on the market are of level 3. In that case, the vehicle can handle itself all aspects of the driving tasks within a certain set of circumstances. In some instances, the human driver must be ready to take back control of the vehicle when the AV so requires, e.g. during a traffic jam. According to car manufacturers’ (enthusiastic) declarations, the next levels of autonomy should reach our market in the coming months or years.
How does Belgian law address liability issues in the case of AV accident?
At this stage, Belgian law does not have any specific liability regime addressing the risks generated by AVs.
A victim of an AV should thus find its way through the existing and non-specific Belgian liability regimes. In short, four liability regimes can be identified as potential legal basis for a claim.
1. The fault-based liability regime (Article 1382 of the Civil Code)
This requires the victim to prove three things: a wrongful behaviour from the AV user, a damage and a causal relationship between the behaviour and the damage.
The tricky question here is whether a driver can be found guilty of a wrongful behaviour if he or she was letting the AV operating itself at the time of the accident?
2. The strict liability regime for the use of defective things (Article 1384 of the civil Code)
The victim should prove its damage and a causal relationship, just like in the previous fault-based liability regime. However, in this case, the victim can limit itself to proving a malfunctioning in the AV, rather than proving a wrongful behaviour of the AV user.
This solves the question raised by the previous regime but raises a new one, e.g. how do you prove a malfunctioning when the accident is the result of an algorithmic decision, which in turn could potentially be the outcome of machine learning?
3. The product liability regime (law of 25 February 1991 on product liability)
This regime is similar to the second liability regime as the victim must prove its damage, a malfunctioning of the AV and a causal relationship between these two aspects. However, in this case, the victim will seek compensation against the manufacturer, not the driver.
Furthermore, the compensable damage will be limited to personal injuries (including moral damage) and, subject to certain conditions, damages to property. Other types of damage (e.g. loss of opportunity) are not recoverable under this specific liability regime.
4. The insurance liability (Article 29bis of the law of 28 November 1989 on compulsory motor vehicles liability insurance).
Once a vehicle is involved in an accident, “weak users” (e.g. pedestrians and cyclists) may obtain compensation from the car insurer for the damages resulting from this accident.
In this case too, recoverable types of damage are limited. They only cover personal injuries or death, as well as damage to clothing (quite oddly).
Vehicles are becoming more and more autonomous. Level 5 (fully autonomous) AVs are still prohibited at this stage but their eventual arrival on the market will generate liability questions for which our legal system is not well equipped.
They will change the fault-based paradigm and we anticipate that a dedicated liability regime (e.g. based on the mere use of the AV) will be needed to complement our existing legal framework. We at Simont Braun will closely follow up on this and keep you posted.
For any question, please contact the authors: