California Enacts AI Transparency Law Requiring Disclosures For AI Content

In Short

The Background: On September 19, 2024, California adopted the California AI Transparency Act ("SB 942") to create transparency mechanisms that allow consumers to determine whether an "image, video, or audio content, or content that is any combination thereof, was created or altered" using generative artificial intelligence ("GenAI").

The Result: SB 942 imposes new obligations on persons creating, coding, or otherwise producing GenAI systems accessed within California, requiring them to provide a publicly accessible detection tool and make certain disclosures for content produced with GenAI.

Looking Ahead: SB 942 becomes effective on January 1, 2026, and will require that companies develop and adopt output generation and detection tools to facilitate watermarking and transparency for users, review their contracting practices with third-party licensees of GenAI platforms, and adjust their AI governance and risk management practices.