SEC rulemaking on artificial intelligence

Section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c) is amended by adding at the end the following: (i) Rulemaking regarding artificial intelligence (1) Definitions In this subsection: (A) Artificial intelligence The term artificial intelligence has the meaning given the term in section 5002 of the National Artificial Intelligence Initiative Act of 2020 (15 U.S.C. 9401). (B) Covered person The term covered person — (i) means a person that is required by a provision of this title, or by a rule or regulation under this title, to maintain policies, procedures, or controls; and (ii) includes— (I) an issuer that has a class of securities registered pursuant to section 12; (II) an issuer that is required to file reports under section 15(d); (III) a broker; (IV) a dealer; (V) a security-based swap dealer; and (VI) a self-regulatory organization. (2) Requirement (A) In general Not later than 180 days after the enactment of this section the Commission shall, by rule or regulation, impose specific requirements on each covered person to ensure that the policies, procedures, or controls described in paragraph (1)(B)(i) maintained by the covered person— (i) address the use of artificial intelligence by the covered person; and (ii) are reasonably designed to ensure compliance with the requirements of this title. (B) Procedures In carrying out subparagraph (A), the Commission shall— (i) identify and require governance measures with respect to testing, deployment, monitoring, human oversight, permissions, escalation procedures, and use limitations applicable to artificial intelligence systems; and (ii) consider the extent to which— (I) artificial intelligence systems are developed, controlled, modified, or operated by a covered person as compared to third-party providers; and (II) control is exercised by a covered person over the actions of artificial intelligence systems..