HB1709 - Relating to the regulation and reporting on the use of artificial intelligence systems by certain business entities and state agencies; providing civil penalties.

      By: Capriglione H.B. No. 1709       A BILL TO BE ENTITLED   AN ACT   relating to the regulation and reporting on the use of artificial   intelligence systems by certain business entities and state   agencies; providing civil penalties.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  This Act may be cited as the Texas Responsible   Artificial Intelligence Governance Act          SECTION 2.  Title 11, Business & Commerce Code, is amended by   adding Subtitle D to read as follows:   SUBTITLE D. ARTIFICIAL INTELLIGENCE PROTECTION   CHAPTER 551. ARTIFICIAL INTELLIGENCE PROTECTION   SUBCHAPTER A. GENERAL PROVISIONS           Sec. 551.001.  DEFINITIONS. In this chapter:                 (1)     "Algorithmic discrimination" means any condition   in which an artificial intelligence system when deployed creates an   unlawful discrimination of a protected classification in violation   of the laws of this state or federal law.                       (A)     "Algorithmic discrimination" does not   include the offer, license, or use of a high-risk artificial   intelligence system by a developer or deployer for the sole purpose   of the developer's or deployer's self-testing, for a non-deployed   purpose, to identify, mitigate, or prevent discrimination or   otherwise ensure compliance with state and federal law.                 (2)     "Artificial intelligence system" means the use of   machine learning and related technologies that use data to train   statistical models for the purpose of enabling computer systems to   perform tasks normally associated with human intelligence or   perception, such as computer vision, speech or natural language   processing, and content generation.                 (3)     "Biometric identifier" means a retina or iris   scan, fingerprint, voiceprint, or record of hand or face geometry.                 (4)     "Council" means the Artificial Intelligence   Council established under Chapter 553.                 (5)     "Consequential decision" means any decision that   has a material, legal, or similarly significant, effect on a   consumer's access to, cost of, or terms or conditions of:                       (A)     a criminal case assessment, a sentencing or   plea agreement analysis, or a pardon, parole, probation, or release   decision;                       (B)     education enrollment or an education   opportunity;                       (C)  employment or an employment opportunity;                       (D)  a financial service;                       (E)  an essential government service;                       (F)  residential utility services;                       (G)  a health-care service or treatment;                       (H)  housing;                       (I)  insurance;                       (J)  a legal service;                       (K)  a transportation service;                       (L)     constitutionally protected services or   products; or                       (M)  elections or voting process.                 (6)     "Consumer" means an individual who is a resident   of this state acting only in an individual or household context.   The term does not include an individual acting in a commercial or   employment context.                 (7)     "Deploy" means to put into effect or   commercialize.                 (8)     "Deployer" means a person doing business in this   state that deploys a high-risk artificial intelligence system.                 (9)     "Developer" means a person doing business in this   state that develops a high-risk artificial intelligence system or   substantially or intentionally modifies an artificial intelligence   system.                 (10)     "Digital service" means a website, an   application, a program, or software that collects or processes   personal identifying information with Internet connectivity.                 (11)  "Digital service provider" means a person who:                       (A)  owns or operates a digital service;                       (B)     determines the purpose of collecting and   processing the personal identifying information of users of the   digital service; and                       (C)     determines the means used to collect and   process the personal identifying information of users of the   digital service.                 (12)     "Distributor" means a person, other than the   Developer, that makes an artificial intelligence system available   in the market for a commercial purpose.                 (13)     "Generative artificial intelligence" means   artificial intelligence models that can emulate the structure and   characteristics of input data in order to generate derived   synthetic content. This can include images, videos, audio, text,   and other digital content.                 (14)     "High-risk artificial intelligence system" means   any artificial intelligence system that is a substantial factor to   a consequential decision. The term does not include:                       (A)     an artificial intelligence system if the   artificial intelligence system is intended to detect   decision-making patterns or deviations from prior decision-making   patterns and is not intended to replace or influence a previously   completed human assessment without sufficient human review;                       (B)     an artificial intelligence system that   violates a provision of Subchapter B; or                       (C)     the following technologies, unless the   technologies, when deployed, make, or are a substantial factor in   making, a consequential decision:                             (i)  anti-malware;                             (ii)  anti-virus;                             (iii)  calculators;                             (iv)  cybersecurity;                             (v)  databases;                             (vi)  data storage;                             (vii)  firewall;                             (viii)  fraud detection systems;                             (ix)  internet domain registration;                             (x)  internet website loading;                             (xi)  networking;                             (xii)  operational technology;                             (xiii)  spam- and robocall-filtering;                             (xiv)  spell-checking;                             (xv)  spreadsheets;                             (xvi)  web caching;                             (xvii)  web scraping;                             (xviii)     web hosting or any similar   technology; or                             (xviv)     any technology that solely   communicates in natural language for the sole purpose of providing   users with information, making referrals or recommendations   relating to customer service, and answering questions and is   subject to an acceptable use policy that prohibits generating   content that is discriminatory or harmful, as long as the system   does not violate any provision listed in Subchapter B.                 (15)     "Open source artificial intelligence system"   means an artificial intelligence system that:                       (A)     can be used or modified for any purpose   without securing permission from the owner or creator of such an   artificial intelligence system;                       (B)     can be shared for any use with or without   modifications; and                       (C)     includes information about the data used to   train such system that is sufficiently detailed such that a person   skilled in artificial intelligence could create a substantially   equivalent system when the following are made available freely or   through a non-restrictive license:                             (i)  the same or similar data;               [Text truncated for display. 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