OpenAI Warns That California's Controversial AI Legislation Could Stifle Innovation

Senate Bill 1047, introduced by Senator Scott Wiener, seeks to establish what his office describes as "common sense safety standards" for companies developing large AI models beyond a specific size and cost threshold. However, OpenAI is opposing the bill, arguing that it would hinder innovation in the AI industry. The San Francisco-based company believes that regulation in this area should be handled at the federal level rather than by individual states. In a letter to Senator Wiener, obtained by Bloomberg News, OpenAI expressed concerns that the bill, if enacted, could have significant negative effects on U.S. competitiveness in AI and national security.

The bill, which was approved by the California State Senate in May, would mandate that AI companies take measures to prevent their models from causing "critical harm," such as contributing to the creation of bioweapons capable of mass casualties or causing financial damage exceeding $500 million. Under the proposed legislation, companies would need to ensure that AI systems can be shut down, exercise "reasonable care" to prevent catastrophic outcomes, and submit a compliance statement to California's attorney general. Non-compliance could result in lawsuits and civil penalties.

The bill has faced strong opposition from major tech firms, startups, and venture capitalists, who argue that it represents an overreach for a technology still in its early stages and could stifle innovation in California. Some critics fear that the bill might drive AI companies out of the state, a concern echoed by OpenAI in its letter to Senator Wiener's office.