Artificial Intelligence (Regulation) Bill [HL][AS INTRODUCED]CONTENTS
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The AI Authority
Regulatory principles
Regulatory sandboxes
AI responsible officers
Transparency, IP obligations and labelling
Public engagement
Interpretation
Regulations
Extent, commencement and short title

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Artificial Intelligence (Regulation) Bill [HL][AS INTRODUCED]

A

BILL
TO

Make provision for the regulation of artificial intelligence; and for connectedpurposes.

B

E IT ENACTED by the King’s most Excellent Majesty, by and with the advice andconsent of the Lords Spiritual and Temporal, and Commons, in this present
Parliament assembled, and by the authority of the same, as follows:—

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The AI Authority(1)

The Secretary of State must by regulations make provision to create a body
called the AI Authority.

(2)

The functions of the AI Authority are to—(a) ensure that relevant regulators take account of AI;(b) ensure alignment of approach across relevant regulators in respect ofAI;(c) undertake a gap analysis of regulatory responsibilities in respect ofAI;(d) coordinate a review of relevant legislation, including product safety,privacy and consumer protection, to assess its suitability to address
the challenges and opportunities presented by AI;(e) monitor and evaluate the overall regulatory framework’s effectivenessand the implementation of the principles in section 2, including theextent to which they support innovation;(f) assess and monitor risks across the economy arising from AI;(g) conduct horizon-scanning, including by consulting the AI industry,
to inform a coherent response to emerging AI technology trends;(h) support testbeds and sandbox initiatives (see section 3) to help AI
innovators get new technologies to market;(i) accredit independent AI auditors (see section 5(1)(a)(iv));(j) provide education and awareness to give clarity to businesses and toempower individuals to express views as part of the iteration of theframework;(k) promote interoperability with international regulatory frameworks.

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The Secretary of State may by regulations amend the functions in subsection(2), and may dissolve the AI Authority, following consultation with suchpersons as he or she considers appropriate.
Regulatory principles

(1)

(2)

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The AI Authority must have regard to the principles that—(a) regulation of AI should deliver—(i) safety, security and robustness;(ii) appropriate transparency and explainability;(iii) fairness;(iv) accountability and governance;(v) contestability and redress;(b) any business which develops, deploys or uses AI should—(i) be transparent about it;(ii) test it thoroughly and transparently;(iii) comply with applicable laws, including in relation to dataprotection, privacy and intellectual property;(c) AI and its applications should—(i) comply with equalities legislation;(ii) be inclusive by design;(iii) be designed so as neither to discriminate unlawfully amongindividuals nor, so far as reasonably practicable, to perpetuate
unlawful discrimination arising in input data;(iv) meet the needs of those from lower socio-economic groups,
older people and disabled people;(v) generate data that are findable, accessible, interoperable andreusable;(d) a burden or restriction which is imposed on a person, or on thecarrying on of an activity, in respect of AI should be proportionate tothe benefits, taking into consideration the nature of the service orproduct being delivered, the nature of risk to consumers and others,
whether the cost of implementation is proportionate to that level ofrisk and whether the burden or restriction enhances UK internationalcompetitiveness.
The Secretary of State may by regulations amend the principles in subsection(1), following consultation with such persons as he or she considers
appropriate.

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Regulatory sandboxes(1)

The AI Authority must collaborate with relevant regulators to constructregulatory sandboxes for AI.

(2)

In this section a “regulatory sandbox” is an arrangement by one or moreregulators which—40

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(a)
(b)

(c)
(d)
(e)

(3)

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allows businesses to test innovative propositions in the market withreal consumers;
is open to authorised firms, unauthorised firms that requireauthorisation and technology firms partnering with, or providing
services to, UK firms doing regulated activities;
provides firms with support in identifying appropriate consumer
protection safeguards;
requires tests to have a clear objective and to be conducted on a small
scale;
requires firms which want to test products or services which are
regulated activities to be authorised by or registered with the relevant
regulator before starting the test.

The Secretary of State may by regulations amend the description in subsection(2), following consultation with such persons as he or she considers
appropriate.

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AI responsible officers
(1)

(2)

The Secretary of State, after consulting the AI Authority and such otherpersons as he or she considers appropriate, must by regulations provide thatany business which develops, deploys or uses AI must have a designated AIofficer, with duties—(a) to ensure the safe, ethical, unbiased and non-discriminatory use of AI
by the business;(b) to ensure, so far as reasonably practicable, that data used by thebusiness in any AI technology is unbiased (see section 2(1)(c)(iii)).
In the Companies Act 2006, section 414C(7)(b), after paragraph (iii) insert—
“(iv)

(3)

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any development, deployment or use of AI by thecompany, and the name and activities of the AI officer
designated under the Artificial Intelligence (Regulation)
Act 2024,”.

The Secretary of State may by regulations amend the duties in subsection (1)and the text inserted by section (2), following consultation with such persons
as he or she considers appropriate.

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Transparency, IP obligations and labelling(1)

The Secretary of State, after consulting the AI Authority and such otherpersons as he or she considers appropriate, must by regulations provide that—(a) any person involved in training AI must—(i) supply to the AI Authority a record of all third-party data andintellectual property (“IP”) used in that training; and(ii) assure the AI Authority that—(A) they use all such data and IP by informed consent;
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(B)

(iii)

(iv)

(2)

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they comply with all applicable IP and copyrightobligations;any person supplying a product or service involving AI must
give customers clear and unambiguous health warnings,
labelling and opportunities to give or withhold informed
consent in advance; andany business which develops, deploys or uses AI must allow
independent third parties accredited by the AI Authority toaudit its processes and systems.

Regulations under this section may provide for informed consent to be express(opt-in) or implied (opt-out) and may make different provision for different
cases.

510Public engagement
The AI Authority must—(a) implement a programme for meaningful, long-term public engagement
about the opportunities and risks presented by AI; and(b) consult the general public and such persons as it considers appropriate
as to the most effective frameworks for public engagement, having
regard to international comparators.

7Interpretation
(1)

(2)

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In this Act “artificial intelligence” and “AI” mean technology enabling theprogramming or training of a device or software to—(a) perceive environments through the use of data;(b) interpret data using automated processing designed to approximate
cognitive abilities; and(c) make recommendations, predictions or decisions;with a view to achieving a specific objective.

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AI includes generative AI, meaning deep or large language models able togenerate text and other content based on the data on which they were trained.
Regulations(1)

Regulations under this Act are made by statutory instrument.

(2)

Regulations under this Act may create offences and require payment of fees,penalties and fines.

(3)

A statutory instrument containing regulations under section 1 or 2 orregulations covered by subsection (2) may not be made unless a draft of theinstrument has been laid before and approved by resolution of both Housesof Parliament.

(4)

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A statutory instrument containing only regulations not covered by subsection(3) is subject to annulment in pursuance of a resolution of either House ofParliament.

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(5)

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A statutory instrument containing regulations applying to Wales, Scotland
or Northern Ireland must be laid before Senedd Cymru, the Scottish Parliamentor the Northern Ireland Assembly respectively before being made.
Extent, commencement and short title(1)This Act extends to England and Wales, Scotland and Northern Ireland.

(2)This Act comes into force on the day on which it is passed.

(3)This Act may be cited as the Artificial Intelligence (Regulation) Act 2024.

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Artificial Intelligence (Regulation) Bill [HL][AS INTRODUCED]

ABILL
TO

Make provision for the regulation of artificial intelligence; and for connected purposes.
Lord Holmes of Richmond

Ordered to be Printed, 22nd November 2023.

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HL Bill 1158/4