Large California companies will soon face new rules on how they use AI

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The California Privacy Protection Agency moved closer in a years-long process of creating rules companies will have to obey about using AI.

We’re a big state with big challenges. Each morning we explain the top issues and how Californians are trying to solve them.One weekly email, all the Golden State newsGet the news that matters to all Californians. Start every week informed.Alphabet is one of the companies that would be affected by the new AI rules being drafted by the California Privacy Protection Agency.

The proposed rules seek to create guidelines for the many areas in which AI and personal data can influence the lives of Californians: job compensation, demotion, and opportunity; housing, insurance, health care, and student expulsion. For example, under the rules, if an employer wanted to use AI to make predictions about a person’s emotional state or personality during a job interview, a job candidate could opt out without fear of discrimination for choosing to do so.

Disclosure is a core part of AI regulation efforts like the privacy protection agency draft rules and the AI Act, which European Union lawmakers expect to pass into law in the coming months. A lack of disclosure has led to instances in recent years where bias algorithms can automate. Algorithms have also made critical decisions about things like housing, health care or education without consumer’s knowledge or consent. Once both laws go into effect, businesses will have 24 months to comply.

That language change sounds like a gap in the law, said board member Vinhcent Le, who was part of a subcommittee that worked with privacy protection agency lawyers and staff to develop the first draft of rules more than two years ago. In public comment at a December 2023 meeting where the board held its first discussions of the draft rules, business groups argued in favor of an exemption from public records requests and eliminating risk assessment approval by a company board of directors. Business interests like the Bay Area Council — whose members include big AI companies like Amazon, Google and Meta — previously argued that the draft rule definitions of AI and automated decision making were too broad.

In response to de La Torre’s concern about litigation, board member Jeffrey Worthe said the meaningful vote is not now but when the board ends the public feedback process and votes to begin formal rulemaking. coauthored by Bernhardt

 

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