Is AI Being Regulated? What This Means for Businesses

AI is being regulated in 2024. Google, Meta, Microsoft, the United States government, and the European Union are among the organizations impacting AI-related legislation and regulatory action.

AI regulation will impact businesses. Staying current on changing regulations will help maintain compliance.

United States Regulatory Action of AI

Federal, state, and local governments are taking regulatory action to ensure AI-based technology is ethically developed and responsibly used. For instance, the Biden administration’s Executive Order on Artificial Intelligence established standards for safety and security to protect privacy and promote innovation:

  • One takeaway from the Safety and Security section was the requirement for developers of AI systems to share safety test results with the federal government.
  • Another takeaway was the development of standards and tools to detect AI-enabled fraud.
  • Other section topics included privacy, equity and civil rights, and consumers.

Congress continues to propose bills regarding the development and use of AI. Whether these bills become laws will impact businesses.

State Regulatory Action of AI

Many states are involved in regulatory activities to establish guidelines for the responsible use of AI. For instance, online political ads are being regulated during this election year:

  • Facebook and Instagram require disclosures if AI is used to create a political ad.
  • Meta’s policy includes the use of labels to disclose if AI is used to create a political ad.
  • Microsoft has a tool to insert digital watermarks on political content to verify authenticity.

European Union Regulation of AI

The European Union’s EU AI Act could serve as a model for international governments to govern the use and sale of AI. The Act addresses the risks of AI-based technology to safeguard health, safety, and fundamental rights.

Impact of AI Regulation on Businesses

AI-based technology can improve business operation efficiency and productivity. However, employers must evaluate the risks of using AI-powered tools and implement safeguards to enhance internal business processes.

Business owners must remain aware of current regulatory requirements in the jurisdictions where they conduct business. Maintaining compliance could involve audits and disclosure requirements at the state and local levels.

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