Enabling RegTech Up Front: Unambiguous Machine‐readable Regulation
By Marcel Fröhlich · 2019
RegTech functionality ranges from data collection technologies to complex decision automation and behavioural analysis. Some tools have an obvious task, e.g. 'record customer dialogues', whereas others try to apply various artificial intelligence (AI) approaches to extract definitions and rules out of regulatory documents to automate complex checks. This chapter focuses on the latter type of RegTech solutions, which are especially relevant for large regulated organizations like banks operating in multiple jurisdictions. The unambiguous, machine-readable regulatory text approach enables regulators to write their regulatory rules and glossaries in unambiguous natural language for human understanding and to publish them as Resource Description Framewok-linked data that preserves the natural language meaning in formal logic for AI-based processing, thus enabling vendors to add value in a holistic way. It moves the entire regulatory compliance process onto a bedrock semantic foundation of human legal meaning.