California Governor Gavin Newsom signed into law a bill aimed at putting “common sense guardrails” on the development of frontier artificial intelligence (AI) models.
Senate Bill 53, also known as the Transparency in Frontier Artificial Intelligence Act (TFAIA), was introduced by California Sen. Scott Wiener (D-San Francisco) on January 7 to promote the “responsible development” of large-scale AI systems.
According to Wiener, the bill aims to address the “substantial risks” posed by advanced AI, but also aims to support California’s world-leading AI development sector by providing low-cost computing resources to researchers and startups.
After several rounds of debate and amendments, Senate Bill 53 passed the state Senate in May, followed by the legislative session in September, and then went to Governor Newsom’s desk.
“California has proven that we can establish regulations that protect our communities and ensure that our growing AI industry continues to thrive, and this legislation strikes that balance,” Newsom said. “AI is a new frontier of innovation, and California is not only here to stay, but strong as a national leader by enacting the nation’s first frontier AI safety law that will build public trust as this emerging technology rapidly evolves.”
The legislation was able to move forward, with U.S. senators voting 99-1 in July to remove provisions in President Trump’s “Big Beautiful Bill” that would have prevented states from enacting regulations for AI.
“The Senate met tonight to say we can’t get past good state consumer protection laws,” Sen. Maria Cantwell (D-WA) said at the time. “The nation can fight robocalls, unleash deepfakes, and provide a safe self-driving vehicle law. It also allows us to work together across the country to deliver a new federal framework on artificial intelligence that accelerates U.S. leadership in AI while protecting consumers.”
What does SB53 do?
Regarding safeguards, SB53 establishes new requirements for frontier AI developers around transparency, accountability, and responsiveness.
Specifically, large frontier developers must publish a framework on their website that describes how the company incorporates national standards, international standards, and industry continuity best practices. It creates a new mechanism for businesses or the public to report potential serious safety incidents to the California Department of Emergency Services. It also protects whistleblowers who disclose significant health and safety risks posed by the Frontier Model and creates civil penalties for violations.
Additionally, the bill directs Caltech to annually recommend appropriate legislative updates based on stakeholder input, technology developments, and international standards.
When it comes to supporting innovation, SB53 establishes a new consortium within government operating agencies to develop a framework for creating public computing clusters.
Newsom’s Office said the consortium, known as “Calcompute,” will “advance the development and deployment of safe, ethical, fair, and sustainable AI by fostering research and innovation.”
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California’s AI Balance Act
In 2024, Governor Newsom vetoed an earlier attempt at an AI law, SB 1047 (written by Weiner), which would have implemented extensive safety protocols for powerful AI systems.
In a statement, Newsom wrote that the bill, while “well-intentioned,” focuses on the largest models and overlooks the risks posed by smaller models or systems, especially those deployed in hazardous environments.
“By focusing only on the most expensive and large-scale models, SB 1047 establishes a regulatory framework that can give the public a false sense of security about controlling this rapidly changing technology,” Newsom said. “Smaller, more specialized models than those targeted by SB 1047 could be equally or even more dangerous, with the potential cost of curtailing the very innovation that favors public goods and promotes progress.”
Since then, calls for AI safeguards have grown significantly, increasing pressure on states to regulate the technology.
On September 22, more than 200 prominent politicians, public figures, and scientists published a letter calling for an urgent and binding “red line” to prevent the use of dangerous AI. They warned that “AI systems are already exhibiting deceptive and harmful behavior, but these systems are being given more autonomy to take action and make decisions in the world.”
But California lawmakers have had to balance these calls for caution and guardrails, not wanting to harm one of the state’s and country’s golden geese.
Four of the five largest companies operating in this sector by market capitalization, NVIDAQ (NASDAQ: NVDA), Apple (NASDAQ: AAPL), Alphabet (Google) (Google) (NASDAQ: GOOGL), and META (NASDAQ: META) – California boasts Open Deversons. According to a report published by Forbes in April, California is home to 32 of the world’s top 50 AI companies.
To meet this challenge of needing to balance the protection of both the public and innovation, a group of leading AI scholars and experts met earlier this year at the Governor’s request to discuss this topic. This led to the release of the National Initial Report on Smart AI Guardrails, based on an empirical, science-based analysis of the frontier model’s capabilities and associated risks.
The report included recommendations on ensuring evidence-based policymaking and advocated for balancing considerations such as security risks with increased transparency.
According to the governor’s office, “SB 53 addresses the report’s recommendations and will help secure California’s position as an AI leader.”
It added that the nation will “balance our work with AI, advance it to protect the public, and embrace technology to make our lives easier and our government more efficient, effective, and transparent.”
For artificial intelligence (AI) to work properly within the law and thrive in the face of rising challenges, it must integrate enterprise blockchain systems that ensure the quality and ownership of data input. Check out Coingeek’s coverage of this new technology to learn more about why enterprise blockchain will become the backbone of AI.
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See: Adding the human touch behind the AI
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