Colorado Passed the Artificial Intelligence Act (“CAIA”)

On May 8, 2024, the Colorado Legislature passed the Colorado Artificial Intelligence Act (“CAIA”), SB 205, which is awaiting Governor Jared Polis's signature to become law. This groundbreaking legislation would make Colorado the first state to comprehensively regulate the use of artificial intelligence (“AI”), especially in high-risk applications. If the CAIA becomes law, it will take effect on February 1, 2026. The Attorney General may choose to create regulations, although it’s not mandatory. The bill lists specific topics that could be covered by these regulations. The Act introduces Part 16 into Colorado’s Consumer Protection Act, focusing primarily on anti-discrimination in high-risk AI systems. It applies to developers and deployers of these systems within Colorado. "Developers" are those who create or significantly modify AI systems, while "deployers" are those who put high-risk AI systems into operation. High-risk AI systems are defined as those that significantly influence consequential decisions, such as those impacting education, employment, financial services, healthcare, housing, insurance, or legal services. Notably, certain technologies like anti-fraud tools without facial recognition, anti-malware, databases, and AI-enhanced video games are exempt unless they directly influence such decisions. The Act defines "consequential decisions" as those with significant legal or similar effects on consumers, such as access to education or employment opportunities, financial services, healthcare, housing, insurance, or legal services.