California Attorney General's Legal Advisory on the Application of Existing California Laws to Artificial Intelligence (January 13, 2025)

Summary

The California Attorney General issued a legal advisory explaining how existing state law applies to entities that develop, sell or use AI, covering the Unfair Competition Law, the False Advertising Law, the Cartwright Act and other competition laws, civil-rights laws, election-misinformation laws and data-protection laws, and summarizing new AI laws effective January 1, 2025. It says businesses must understand how the AI systems they use are trained and generate output, and must be transparent about how they use AI to make decisions affecting consumers. On discrimination, it points to the Unruh Civil Rights Act, the Fair Employment and Housing Act and Government Code section 11135, notes that AI systems have incorporated societal biases into decisions, and says entities taking adverse action, including credit decisions made with AI, must give specific reasons. On competition, it warns that even inadvertent harm to competition from AI systems, such as those that set prices, may violate state competition law. The advisory is guidance on existing law, not a new rule. A companion advisory covers health care (state-152).

Key dates

1. 2025-01-13 (date of issue)Takes effect
2. October 16, 2026Checked against sources
3. October 21, 2026Checked against sources

Developments are added when the record is reviewed. Next review: January 15, 2027.

Evidence

Each passage is quoted from its source. The quoted passages are re-checked against the live pages every month.

1. Monday, January 13, 2025

   Supports: Date of issue

   The first legal advisory advises consumers and entities about their rights and obligations under the state’s consumer protection, civil rights, competition, and data privacy laws

   Supports: Scope of the advisory

   Attorney General Bonta Issues Legal Advisories on the Application of California Law to AI California Department of Justice, Office of the Attorney General Primary source

2. Businesses must understand how the AI systems they utilize are trained, what information the systems consider, and how the systems generate output.

   Supports: Duty to understand AI systems

   We have seen AI systems incorporate societal and other biases into their decision-making.

   Supports: Algorithmic discrimination under civil-rights laws

   Other laws also require that entities that take adverse action against citizens provide specific reasons for those adverse actions, including when AI was used to make the determination.

   Supports: Adverse-action reasons, including credit

   AI developers and users should be aware of any risks to fair competition created by AI systems, such as those that set pricing.

   Supports: AI pricing and competition law

   California Attorney General’s Legal Advisory on the Application of Existing California Laws to Artificial Intelligence California Department of Justice, Office of the Attorney General Primary source