California Privacy Agency Weakens AI Rules Following Industry and Political Pressure
The revised regulations eliminate key AI oversight, reduce compliance burdens for businesses, and retain limited safeguards for high-stakes sectors.
Overview
- The California Privacy Protection Agency (CPPA) unanimously voted to scale back draft rules regulating AI and automated decisionmaking systems.
- Changes include removing oversight of behavioral advertising, eliminating the term 'artificial intelligence,' and narrowing the definition of automated decisionmaking.
- Compliance costs for businesses are projected to drop from $834 million to $143 million in the first year, with 90% of businesses no longer required to comply.
- Governor Gavin Newsom supported the rollback, arguing the original draft exceeded the agency's authority under Proposition 24.
- Limited protections remain, requiring risk assessments for fully automated systems in critical areas like finance, housing, and health care.