Utah Passes First State Law on AI Regulation

• Establishes liability for the use of AI that violates consumer protection laws if not properly disclosed

• Creates the Office of Artificial Intelligence Policy and a regulatory AI analysis program

• Requires disclosure when an individual interacts with AI in a regulated occupation

• Establishes the Artificial Intelligence Learning Laboratory Program to assess technologies, risks, and policy

• Facilitates temporary mitigation of regulatory impacts during AI pilot testing

• Grants the office rulemaking authority over AI programs and regulatory exemptions

The director of the Utah Division of Consumer Protection has the authority to impose administrative fines of up to $2,500 for each violation. Additionally, individuals found in violation of administrative or court orders issued under the AIPA may face civil penalties of up to $5,000 per violation.

Businesses regulated under the AIPA must quickly adapt to comply with the new disclosure requirements before the May 1, 2024, effective date.

Attorney Aaron Parry of Mac Murray & Shuster LLP recommends that “businesses review all automated systems incorporating generative AI to assess how such systems may interact with consumers and identify associated risks, implement strong AI compliance procedures and monitor efficacy, and ensure employees are trained on proper AI usage.”

Utah's precedent has led many other states to introduce and explore their own AI legislation. It is important to stay informed and adaptable as the future of AI continues to evolve.

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