Bhojani Bill Makes Businesses Label AI Use, $5,000 Per Violation

The text as introduced · 384 words

By: Bhojani
H.B. No. 625

A BILL TO BE ENTITLED

AN ACT

relating to the labeling of artificial intelligence systems by

businesses for commercial purposes.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Chapter 17, Business & Commerce Code, is amended

by adding Subchapter M to read as follows:

SUBCHAPTER M. LABELING OF ARTIFICIAL INTELLIGENCE

Sec. 17.956. DEFINITIONS. In this subchapter:

(1) "Commercial purpose" means a purpose that is

intended to result in a profit or other tangible benefit as defined

by Section 17.08.

(2) "Consumer" means an individual, partnership,

corporation, this state, or a subdivision or agency of this state

who seeks or acquires by purchase or lease, any goods or services.

(3) "Consequential decision" means a decision that has

a material legal or similarly significant effect on the product

provided to a consumer.

(4) "Heightened scrutiny artificial intelligence

system" means an artificial intelligence system as defined by

Section 2054.003, Government Code.

(5) "Label" means a display of written, printed, or

graphic matter to alert potential consumers of the use of

heightened scrutiny artificial intelligence system.

(6) "Product" is defined by Section 17.461.

Sec. 17.957. ARTIFICIAL INTELLIGENCE LABELING. (a)

Businesses that operate for a commercial purpose must label their

usage of heightened scrutiny artificial intelligence in a clear and

conspicuous manner in an area of the business accessible to

consumers, on any Internet website, or a social media site,

maintained by the business.

Sec. 17.958. ENFORCEMENT BY ATTORNEY GENERAL; INJUNCTION

AND CIVIL PENALTY. (a) If the attorney general believes that a

person has violated or is violating Section 17.957, the attorney

general may bring an action on behalf of the state to enjoin the

person from violating that section.

(b) In addition to seeking an injunction under Subsection

(a), the attorney general may request and the court may order any

other relief that may be in the public interest, including:

(1) the imposition of a civil penalty in an amount not

to exceed $5,000 for each violation of Section 17.957;

(2) an order requiring reimbursement to this state for

the reasonable value of investigating and prosecuting a violation

of Section 17.957; and

(3) an order requiring restitution to a victim for

legal and professional expenses related to the violation.

SECTION 2. This Act takes effect September 1, 2027.