Ireland: The ‘Internet Of Things': Legal Challenges In An Ultra-Connected World

The 'Internet of Things' (IoT) is a real game changer that is set to transform our lives. Gartner predicts that by the end of this year over 6.4 billion web-enabled devices will be connected as part of the Internet of Things, an increase of 30% on 2015. And a staggering 5.5 million new 'things' will be added each day with the total predicted to rise to over 20 billion by 2020.

What exactly is the 'Internet of Things'?

In simple terms, the Internet of Things, which is also known as the IoT, is a collection of everyday physical 'smart devices' that are connected to the internet (and in turn to each other) and which send and receive myriads of user data. Examples include 'smart' thermostats, wearable devices, home security web-cam monitoring, and even 'smart' coffee machines. The IoT allows users to control and interact with these devices individually or collectively through apps on their smartphone. Some IoT companies even claim that their devices can 'learn' user behaviours and adapt to them.

Privacy and security

Many of the legal challenges arising from smart devices that are constantly sensing and/or tracking our behaviour are new. Consequently, it is not always easy to apply existing laws to the range of IoT devices in the market. We have previously examined Data Protection and Privacy Challenges in IoT and IoT Recommendations from EU Privacy Regulators. As these articles illustrate, two of the core risk areas with the IoT relate to user privacy and device security. This could be anything from hackers breaking into the user's IoT network at home and controlling or disabling devices remotely, to unauthorised access or theft of personal data.

Other legal challenges

While it is probably true that security and privacy protections will determine the success of the IoT, in this article we will explore some other legal challenges that arise in the IoT and why the absence of approved standards or protocols relating to the operation of IoT devices adds to these challenges.

Different regulations in different countries

In the US, the Federal Trade Commission (FTC) has recently released an IoT report, which contains the following three key recommendations for companies designing or developing IoT devices:

  • data security - IoT companies should design devices so that they are physically secure 'out of the box'
  • data consent – IoT companies should let users choose what data they share and promptly notify them of a data breach
  • data minimization – IoT companies should not collect more data than they need

One of the uncertainties for IoT companies is that different regulations may be adopted in different jurisdictions. This adds to the operating costs and regulatory burden of an IoT company operating in multiple jurisdictions. Importantly, however, the FTC guidelines appear to be broadly consistent with many of the recommendations from the EU's Article 29 Working Party Opinion from late 2014, which itself seemed to rely on features of the draft EU General Data Protection Regulation, such as privacy by design, the right to data portability and the principle of data minimisation.

Chain of liability

As automation and decision-making robots become a reality, the question of who is liable when an IoT device malfunctions or crashes becomes blurred. For example, if a self-drive car accelerates too quickly and causes a traffic accident on the M1 motorway, it is complicated to determine who in the chain of supply is liable to the user. Every stakeholder, from the IoT end-supplier in Ireland, to the device manufacturer who could be located in China, the sensor designer who could be located in Germany, the software programmer who could be located in the UK, the hosting company hosting the user's data who could be located in the US, and the local Irish internet service provider, will scramble to review the terms of their respective contracts and each may try to 'blame' the next party along in the chain of liability.

Complicated ownership of data scenarios

As data is the currency that flows through the IoT and allows it to work, an IoT company can create enormous value if it is able to understand the nature and patterns of information its devices collect from users. It could exploit this data for everything from using it to target advertising for particular users to determining the company's overall strategy and direction. However, from a legal perspective, the scenario of ownership of data becomes complicated in a home using a range of connected IoT devices from different suppliers that share the user's data between devices.

Availability of bandwidth and 'net neutrality'

'Net neutrality' refers to the concept that governments and internet service providers (ISPs) have a duty to treat all data on the internet equally and not discriminate or charge users extra for any reason, whether by user type, user location, website visited or equipment used. In future, with so many different IoT devices all trying to use the same wires of the internet, the world wide web may become congested as it tries to process all of the traffic on the network at the same time. While advocates of 'net neutrality' are opposed to a 'dual lane' internet, with so many connected devices and so much data being transferred, unless there is significant investment in infrastructure, ISPs or governments may be forced to require IoT users pay to a premium for unmetered and unlimited access to the internet.

Intellectual Property

If IoT devices manufactured by different companies are not interoperable and remain locked to their own proprietary networks and technology this will limit the usefulness of the IoT and may cause competitors or users to take legal action. We may see some IoT companies trying to lock users into the company's own 'eco-system' by using copyright law to protect their IP and to prevent competitors from using their software and APIs. There are also numerous patents being filed in relation to protecting wearable technology, such as solar powered contact lenses and even certain hand gestures. These developments mean that companies designing IoT solutions should carefully consider how they can protect the IP they create and ensure they are not infringing someone else's IP.

Automated contracts

The IoT may mean we start to see contracts being formed between two machines. For example, a 'smart' washing machine may know that a user is running low on washing powder and order a box directly from the website of the local supermarket using the user's pre-programmed account log-in details, address and credit card information. While under existing laws it is possible for someone to set up recurring orders to replace items they have already ordered in person over the internet, it is not clear if existing principles of Irish law would apply to a contract between two machines where there is no user input. The uptake of IoT may also require the review of definitions used in consumer legislation as the current definitions contemplate some form of communication between traders and consumers.

Conclusion: What can an IoT company do?

The issues we have considered above show that as the IoT matures and becomes more complex, the law may struggle to evolve quickly enough to address the challenges it poses. Past experience with other technologies shows that when this happens the industry is likely to face considerable regulatory and media scrutiny.

Understandably, though, many existing IoT companies are reluctant to follow government guidelines and self-regulate when the parameters of such self-regulation are not clear and where it may result in them losing competitive advantage. However, as IoT regulations and rules are still being established, now is the perfect time for IoT companies to plan and adapt their products and services accordingly. This will allow them to differentiate themselves from the competition in the market and to position themselves as the company that offers products that help customers interact with their devices like never before while minimising the challenges of an ultra-connected world.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
21 Jan 2018, Seminar, Dublin, Ireland

We are delighted to sponsor Airline Economics Growth Frontiers 2018 Conference taking place in the Shelbourne Hotel in Dublin from 21 to 24 January 2018.

23 Jan 2018, Business Breakfast, Dublin, Ireland

We are pleased to sponsor a Dublin Chamber of Commerce breakfast briefing at 8am on Tuesday 23 January at our offices at South Bank House, Barrow Street, with Vanessa Tierney of Abodoo.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions