WHAT THIS BILL REGULATES · 3 REQUIREMENT TYPES
How Is This Bill Enforced
Verbatim statutory text on the left; plain-language analysis and a per-section checklist on the right. Numbered markers cross-link to the matching checklist row.
Sec. 2003.001. DEFINITION. In this chapter, "artificial intelligenceArtificial intelligence"Artificial intelligence" means a machine-based system that: (1) when given a set of objectives by an individual, makes predictions, recommendations, or decisions that influence a real or virtual environment; and (2) uses inputs from an individual or machine to: (A) perceive or interpret a real or virtual environment; (B) use automation to analyze a perception or interpretation of a real or virtual environment; or (C) use models to infer or form opinions on information or a proposed action.Bus. & Com. Code § 2003.001" means a machine-based system that: (1) when given a set of objectives by an individual, makes predictions, recommendations, or decisions that influence a real or virtual environment; and (2) uses inputs from an individual or machine to: (A) perceive or interpret a real or virtual environment; (B) use automation to analyze a perception or interpretation of a real or virtual environment; or (C) use models to infer or form opinions on information or a proposed action.
This section establishes the sole defined term in the chapter — artificial intelligence — using a functional, technology-neutral definition that tracks the OECD/NIST framing. The definition is broad, covering any machine-based system that makes predictions, recommendations, or decisions influencing a real or virtual environment and that perceives, analyzes, or infers from inputs. No formal definitions are provided for the covered entity category ("a person" meeting the revenue threshold in § 2003.002) or for any covered platform.
(a) This chapter applies only to a person who: (1) uses artificial intelligenceArtificial intelligence"Artificial intelligence" means a machine-based system that: (1) when given a set of objectives by an individual, makes predictions, recommendations, or decisions that influence a real or virtual environment; and (2) uses inputs from an individual or machine to: (A) perceive or interpret a real or virtual environment; (B) use automation to analyze a perception or interpretation of a real or virtual environment; or (C) use models to infer or form opinions on information or a proposed action.Bus. & Com. Code § 2003.001 to provide services to an individual in this state, including: (A) answering questions; (B) gathering information; (C) summarizing information; (D) generating textual, audio, or visual material; or (E) providing information to be used in connection with a lending, underwriting, risk assessment, investing, or hiring decision; and (2) generated, or is more than 25 percent owned by a person who generated, at least $100 billion in total revenue, including revenue generated by subsidiaries, according to generally accepted accounting principles.
(b) Artificial intelligenceArtificial intelligence"Artificial intelligence" means a machine-based system that: (1) when given a set of objectives by an individual, makes predictions, recommendations, or decisions that influence a real or virtual environment; and (2) uses inputs from an individual or machine to: (A) perceive or interpret a real or virtual environment; (B) use automation to analyze a perception or interpretation of a real or virtual environment; or (C) use models to infer or form opinions on information or a proposed action.Bus. & Com. Code § 2003.001 is considered to be used to provide a service to an individual under Subsection (a)(1) regardless of whether the individual can directly access the artificial intelligenceArtificial intelligence"Artificial intelligence" means a machine-based system that: (1) when given a set of objectives by an individual, makes predictions, recommendations, or decisions that influence a real or virtual environment; and (2) uses inputs from an individual or machine to: (A) perceive or interpret a real or virtual environment; (B) use automation to analyze a perception or interpretation of a real or virtual environment; or (C) use models to infer or form opinions on information or a proposed action.Bus. & Com. Code § 2003.001.
This section defines the bill's scope by identifying the class of covered persons. The chapter applies only to persons who (1) use AI to provide services to individuals in Texas — including answering questions, gathering or summarizing information, generating textual, audio, or visual material, or providing information for lending, underwriting, risk assessment, investing, or hiring decisions — and (2) generated at least $100 billion in total revenue (including subsidiaries) or are more than 25 percent owned by such a person. The revenue threshold limits the bill's practical reach to the largest technology companies.
Subsection (b) clarifies that the AI need not be directly accessible to the individual receiving the service — back-end AI use also triggers the chapter.
(a) 1 A person regulated by this chapter shall disclose, on the person's Internet website or in another location electronically accessible by an individual in this state: (1) the name of each artificial intelligenceArtificial intelligence"Artificial intelligence" means a machine-based system that: (1) when given a set of objectives by an individual, makes predictions, recommendations, or decisions that influence a real or virtual environment; and (2) uses inputs from an individual or machine to: (A) perceive or interpret a real or virtual environment; (B) use automation to analyze a perception or interpretation of a real or virtual environment; or (C) use models to infer or form opinions on information or a proposed action.Bus. & Com. Code § 2003.001 model used by the person; (2) a brief description of the functions and purposes of each model disclosed under Subdivision (1); (3) to the best of the person's knowledge and belief, the name of each public or private third party that has provided input on an artificial intelligenceArtificial intelligence"Artificial intelligence" means a machine-based system that: (1) when given a set of objectives by an individual, makes predictions, recommendations, or decisions that influence a real or virtual environment; and (2) uses inputs from an individual or machine to: (A) perceive or interpret a real or virtual environment; (B) use automation to analyze a perception or interpretation of a real or virtual environment; or (C) use models to infer or form opinions on information or a proposed action.Bus. & Com. Code § 2003.001 model that the person has implemented; (4) a description of the specific input provided by each third party disclosed under Subdivision (3); and (5) any changes made to an artificial intelligenceArtificial intelligence"Artificial intelligence" means a machine-based system that: (1) when given a set of objectives by an individual, makes predictions, recommendations, or decisions that influence a real or virtual environment; and (2) uses inputs from an individual or machine to: (A) perceive or interpret a real or virtual environment; (B) use automation to analyze a perception or interpretation of a real or virtual environment; or (C) use models to infer or form opinions on information or a proposed action.Bus. & Com. Code § 2003.001 model based on input provided by a third party disclosed under Subdivision (3).
(b) 1 An individual who uses a service described by Section 2003.002(a)(1) who provides input on an artificial intelligenceArtificial intelligence"Artificial intelligence" means a machine-based system that: (1) when given a set of objectives by an individual, makes predictions, recommendations, or decisions that influence a real or virtual environment; and (2) uses inputs from an individual or machine to: (A) perceive or interpret a real or virtual environment; (B) use automation to analyze a perception or interpretation of a real or virtual environment; or (C) use models to infer or form opinions on information or a proposed action.Bus. & Com. Code § 2003.001 model is not considered a third party for purposes of this section if the individual's input was provided: (1) in the individual's personal capacity; and (2) based on the individual's own experience as a user of that service.
This section imposes the bill's core substantive obligation: covered persons must publicly disclose, on their website or another electronically accessible location, five categories of information about their AI models — the name of each model, a description of each model's functions and purposes, the identity of third parties that provided input on the models, a description of each third party's specific input, and any changes made to a model based on such third-party input. The disclosure duty applies to all AI models the person uses, not only those directly accessible to end users.
Subsection (b) carves out individual end users whose personal-capacity feedback (based on their own experience as a user) would otherwise qualify them as disclosable "third parties." This prevents routine user feedback from triggering the third-party disclosure requirements.
2 A person may not discipline, retaliate against, or otherwise discriminate against an individual who in good faith reports a suspected violation of this chapter to the attorney general or any other appropriate authority.
This section prohibits covered persons from disciplining, retaliating against, or otherwise discriminating against any individual who in good faith reports a suspected violation of the chapter to the attorney general or any other appropriate authority. Unlike more elaborate whistleblower frameworks, this provision does not require an internal reporting channel or specify remedies for retaliation — it relies on the DTPA enforcement mechanism in § 2003.006.
3 A person shall allow the attorney general to access the records of the person to the extent necessary to ensure the person is in substantial compliance with this chapter.
This section requires covered persons to grant the attorney general access to their records to the extent necessary to verify substantial compliance with the chapter. This is a standing regulatory access obligation — not triggered by a specific complaint or incident — and effectively requires the covered person to maintain records in a form that can be produced on demand.
(a) A violation of this chapter is a deceptive trade practice under Subchapter E, Chapter 17, and is actionable under that subchapter.
(b)–(c) The attorney general may issue reports to the governor, the legislature, or any other federal, state, or local government official regarding any information obtained investigating a person under this chapter or enforcing a provision of this chapter. A report under Subsection (b) may be public or confidential.
(d) The remedies under this section are cumulative of other remedies provided by law.
This section establishes the enforcement framework by classifying any violation of the chapter as a deceptive trade practice under the Texas DTPA (Subchapter E, Chapter 17, Business & Commerce Code), making it actionable under that subchapter. This gives both the attorney general and private consumers enforcement standing. Subsection (b) grants the attorney general authority to issue public or confidential reports to the governor, the legislature, or other government officials regarding information obtained through investigations under the chapter. Subsection (d) confirms that these remedies are cumulative of other remedies provided by law.