Texas AI Law

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When Texas Law Requires an AI Disclosure

Business and Commerce Code § 552.051 reaches governmental agencies and health care providers. It does not impose a general labeling rule on private chatbots.

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Texas’s AI disclosure provision is narrower than many summaries suggest. Business and Commerce Code § 552.051 of the Business and Commerce Code, added by TRAIGA, creates two duties.

The first applies to a governmental agency that makes available an AI system intended to interact with consumers. The agency must disclose to each consumer, before or at the time of interaction, that the consumer is interacting with an AI system (Business and Commerce Code § 552.051(b)). The disclosure is required even if a reasonable consumer would know (Business and Commerce Code § 552.051(c)); it must be clear and conspicuous, in plain language and free of dark patterns as defined in the TDPSA (Business and Commerce Code § 552.051(d)); and it may be provided by hyperlink (Business and Commerce Code § 552.051(e)).

The second applies to health care. If an AI system is used in relation to a health care service or treatment, the provider must disclose that to the recipient or the recipient’s personal representative no later than the date the service or treatment is first provided, or as soon as reasonably possible in an emergency (Business and Commerce Code § 552.051(f)). “Health care services” are services related to human health or the diagnosis, prevention or treatment of disease or impairment provided by a licensed, registered or certified individual (Business and Commerce Code § 552.051(a)).

Nothing in Business and Commerce Code § 552.051 requires a private retailer, bank or employer to label a chatbot. That does not end the analysis. A private chatbot’s statements are subject to the DTPA and the FTC Act, and other states require chatbot disclosure for their residents. Government bodies have a second disclosure duty under SB 1964 (Government Code § 2054.707 and Government Code § 2054.711), and health care practitioners using AI for diagnosis have a separate duty under SB 1188 (Health and Safety Code § 183.005).

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