While there are those who feel the work of the Malta Digital Innovation Authority (MDIA) is shrouded in obscurity, to hear the authority’s CEO explain it, the MDIA has set itself up to play a critical role in an increasingly digitalised world.

The remit of the MDIA is two-fold:

It has the duty to licence technology, but more than that, it is also an authority to assure the technology.

Speaking on Friday morning’s episode of The Boardroom, MDIA CEO Stephen McCarthy explained that a move towards setting up the authority started about two years ago, when there was the hype of blockchain.

“There were a lot of Initial Coin Offerings at the time, and money invested…ultimately, people and users were investing in technology that did not perform as promised.

“Here, we came up with the idea that, in this case, when it comes to innovative technology, we need to give assurances.

“By assurance we mean what is being promised in English, by the operators, is being performed by the technology. That is where we came in.”

Mr McCarthy explained that there were challenges when it came to giving assurances on Distributed Ledger Technology (DLT), such as blockchain, since everything was so new.

“Now, we also have Artificial Intelligence (AI) and we are continuing to increase the kinds of technology we can review.”

Mr McCarthy explained that it was a challenge to find qualified resources for work in innovative technology, which is why the MDIA decided to opt for a system where it decided to accredit systems auditors which have international standing and experience.

The MDIA has accredited five systems auditors so far which are listed on the authority’s website. The auditors are accredited to perform due diligence on innovative technologies, which ascertains that the operator’s technology is doing what it claims to do, no more and no less.

“Up till now, we have been used to doing due diligence on individuals. When we have operators and applications, we do the due diligence, in fact the MDIA also does the due diligence on the persons behind the technology.

“Now we went a step further and are doing due diligence on the technology itself. It is something different and something new.”

Mr McCarthy proudly shares that the European Commission, with whom the MDIA is currently in consultation with, are suggesting to adopt this exact same model.

“I always said that in this area, Malta was ahead of its time, and it is now being proven. Today, the EC are putting pen to paper through legislation, saying that when it comes to innovative technology, and especially critical systems, it is not right to launch something new without this system or technology being reviewed. That is exactly what we decided to do two years ago and what we are doing at the moment”.

Asked about headline projects over the past two years within the MDIA, Mr McCarthy shared that while the authority began to provide assurances for DLT platforms, such as blockchain, today it has widened its remit “in no small way”.

“We are venturing into AI and assurance of AI, which is quite challenging in itself. We are also doing assurances for critical systems.”

Anticipating the follow-up question for such a statement, Mr McCarthy delves into what constitutes a ‘critical system’.

Providing an example to showcase what is meant, Mr McCarthy said:

“Recently Malta has launched a contact tracing application, with the MDIA having been involved in this process.

“Given the rigid rules we have for privacy issues, we wanted to make sure that this application provides users with peace of mind that what we are saying – that there is no access to private information – is true.

“This is where we came in as the MDIA, especially keeping in mind that the Ministry of Health did not want to launch this application unless there was an assurance/review made by one of the authority’s system auditors, that private data is not accessible to individuals and not even to central authorities – which is the case.”

The contact tracing app is thus deemed to be a critical system, due to its intended widespread use. The MDIA nowadays therefore provides assurances on a far wider spectrum of technology than DLT platforms and can do so from a data protection aspect of innovative technologies and from a cyber security aspect.

The latter is becoming increasingly essential in the current COVID-scenario, with most businesses having to take operations online.

Mr McCarthy said that the authority is currently in discussions with the Government in order for there to be a mandatory requirement of a systems audit when it comes to critical systems being launched within the public sector.

The CEO turns his attention to the potential innovative technology can have on society by improving standards of living. He pointed towards the countless books, theories and philosophies put forward by economists with the ultimate aim of increasing a country’s output.

“Now we have something totally different. Now we have the technology which, in my opinion, is only slowly being accepted and embraced. This technology will tremendously increase the output of a country, which will tremendously increase our standards of living.

“We need awareness by the whole public and by the business community, which, in my opinion, is not there.”

Besides certification, the MDIA are also working on the promotion of awareness of innovative technology, covering young students to fully fledged business communities.