SB2966 - Relating to establishing a framework to govern the use of artificial intelligence systems in critical decision-making by private companies and ensure consumer protections; authorizing a civil penalty.

  89R17835 SCR-D     By: Schwertner S.B. No. 2966       A BILL TO BE ENTITLED   AN ACT   relating to establishing a framework to govern the use of   artificial intelligence systems in critical decision-making by   private companies and ensure consumer protections; authorizing a   civil penalty.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subtitle C, Title 11, Business & Commerce Code,   is amended by adding Chapter 551 to read as follows:   CHAPTER 551.   ALGORITHMIC ARTIFICIAL INTELLIGENCE SYSTEMS           Sec. 551.001.  DEFINITIONS. In this chapter:                 (1)     "Artificial intelligence system" means any   machine learning-based system that, for any explicit or implicit   objective, infers from the inputs such system receives how to   generate outputs, including content, decisions, predictions, and   recommendations, that can influence physical or virtual   environments.                 (2)     "Consequential decision" means any decision that   has a material, legal, or similarly significant effect on a   consumer.           Sec.   551.002.     ARTIFICIAL INTELLIGENCE FRAMEWORK. A private   company that uses an artificial intelligence system to make a   consequential decision shall establish a framework to govern the   use of the system to ensure protection of consumers.           Sec.   551.003.     CIVIL PENALTY.   A private company that   violates this section is liable for a civil penalty not to exceed   one dollar.          SECTION 2.  This Act takes effect September 1, 2025.