TRAIGA

Definitions and scope

TRAIGA applies to AI developers and deployers that advertise or conduct business in Texas, develop products used by Texas residents, or develop or deploy AI systems within the state. The Act also applies to Texas state and local government entities.^[8][12][14]

The Act defines a developer as a person who develops an AI system and a deployer as one who deploys an AI system in Texas. Consumers are defined as Texas residents.^{[8][12][14][16]}

The Act defines an artificial intelligence system as a machine-based system that "infers from the inputs the system receives how to generate outputs, including content, decisions, predictions, or recommendations, that can influence physical or virtual environments."^{[7][12][14][15]}

Government use  

The Act requires government agencies to provide consumers with plain language notices before interacting with AI systems. It also prohibits government agencies from using artificial intelligence systems to assign social scores to consumers. It also restricts the use of AI systems to identify individuals using biometric data without the individual’s consent.^{[7][8][9][11][12][14][15][10][16]}

Prohibitions

The Act prohibits the development or deployment of artificial intelligence systems intended to cause harm, self-harm, or criminal activity. It also prohibits the development or deployment of AI systems designed to violate constitutional rights or unlawfully discriminate based on protected classes.^{[7][8][9][10][11][12][13][14][15][16]}

In addition, the Act prohibits the development or deployment of AI systems that are intended to produce or distribute child sexual abuse material or unlawful deepfakes.^{[7][8][9][10][11][12][13][14][15][16]}

Enforcement

Enforcement authority under the Act rests with the Texas Attorney General. The Act does not create a private right of action.^{[30][15][11][12][14]}

The Act requires the Texas Attorney General to create an online complaint system where consumers may submit allegations of potential violations. The Attorney General can investigate complaints received through this system and may request information relevant to the operation of an AI system, including information about training data.^[11][13][15]

Before initiating an enforcement action, the Attorney General must provide a written notice to the alleged violator, who is then provided with a 60-day period to cure the alleged violation.^[12][15]

Penalties

If a violation is not cured, the Act authorizes civil penalties. Penalties range from $10,000 to $12,000 per curable violation and from $80,000 to $200,000 per non-curable violation. The Act also authorizes additional penalties of $2,000 to $40,000 for each day the violation continues.^{[8][9][10][12][13][14][15]}

If the Attorney General determines that a person certified or licensed by a state agency has violated the Act and recommends enforcement, the relevant agency may impose additional administrative sanctions, including license suspension or further monetary penalties.^[9][13][14]

Safe harbor

The Act provides an affirmative defense for AI developers and deployers who identify potential violations through internal testing or auditing or who demonstrate compliance with National Institute of Standards and Technology (NIST)'s Artificial Intelligence Risk Management Framework or a comparable risk management framework.^{[30][8][9][12][13][14][15]}

The Act also affords protection to developers and deployers when a third party uses their AI systems in a way that violates the Act.^[12][13]

Texas Artificial Intelligence Council  

The Act creates the Texas Artificial Intelligence Council to assist the state legislatures in evaluating artificial intelligence policy and oversight. The Council is charged with developing recommendations for state agencies regarding the use of AI systems and with overseeing the regulatory sandbox.^{[7][10][11][13]}

TRAIGA gives the Council the ability to organize AI-related training for state entities and issue reports concerning artificial intelligence. The Council does not have binding rulemaking authority.^[10][11][13]

The Council consists of seven members appointed by the governor, the lieutenant governor, and the speaker of the Texas House of Representatives.^[13][31]

Regulatory sandbox

The Act directs the Texas Department of Information Resources to create a regulatory sandbox program that allows participants to test AI systems under state supervision in a modified regulatory setting.^[11][13][15]

To join the program, companies must submit applications that describe their AI systems and intended use. Approved participants may operate within the sandbox for up to 36 months. During that period, the Attorney General is restricted from initiating enforcement actions for certain categories of violations.^{[8][9][10][13]}

Support

During legislative testimony, the Texas Public Policy Foundation stated that TRAIGA would benefit Texas businesses by reducing legal ambiguity and creating clearer compliance standards.^[21][4] Representatives of business groups also expressed support, stating that the Act would not impose overly burdensome regulations.^[32][3]

The consumer rights organization EFF-Austin praised the act for addressing concrete harms.^[21] AI legal expert Matthew Murrell also said that TRAIGA would strengthen consumer rights and privacy protections.^[31]

CBS News reported that additional supporters described the legislation as intended to reduce risks associated with AI and allow private sector innovation.^[1]

Criticism

Texas Appleseed, a nonprofit advocacy organization, stated that while it did not oppose the bill, it was concerned that the Texas Artificial Intelligence Council lacks sufficient authority over the regulatory sandbox program.^[4]

EFF-Austin noted that the Act does not include a private right of action, which the organization indicated would provide a more meaningful enforcement mechanism for consumers.^[21]

The Texas Tribune also reported that some critics maintained that the legislation could create legal uncertainty for businesses.^[21]