California’s New AI Transparency Law is Here to Lift the Veil

California is once again leading the charge in ensuring transparency in AI development! With the passing of Assembly Bill 2013, we’re about to see a significant shift in how AI companies disclose information about the training data behind their models.

Here’s why this matters: Starting on January 1, 2026, and for every subsequent release or substantial modification of a generative AI system or service (originally made publicly available on or after January 1, 2022), AI developers must publicly disclose key information. This includes generative AI systems that create synthetic content like text, images, and audio. Regardless of whether compensation is involved, companies will be required to share critical details about their data sources, which will make these companies more transparent and accountable..

Why is this important?

Data Disclosure: AI developers will be required to provide a high-level summary of the datasets used to train their systems. This includes details on where the data comes from, how it’s used, and whether it includes copyrighted or personal information.

Data Points: Companies must give estimates of the data volume they’re working with—often running into the millions or even billions of data points. Whether it’s text, images, or video content, we’ll have insight into the size and scope of the datasets powering these models.

Copyright & Privacy: Generative AI systems often rely on copyrighted material or personal data. With this law, companies will need to disclose whether they’re using protected content or personal information, which is essential for safeguarding creators’ rights and privacy.

Historical Context: Developers will need to disclose the time period during which the data was collected, giving us better context on how relevant or timely the data is. We’ll know if models are built on recent or outdated information.

Synthetic Data: The law also requires developers to reveal whether they’re using synthetic data in their models, along with the purpose behind its use. This transparency ensures that synthetic content’s role in development is clearly explained.

This increased transparency will hold companies accountable, giving the public a clearer understanding of how these powerful systems are built and trained. It empowers users, consumers, and policymakers to better understand AI’s role in our lives and push for responsible development.

As AI continues to advance, legislation like AB-2013 is a vital step toward balancing innovation with accountability. It’s about ensuring that AI serves everyone’s best interests, built on a foundation of ethics and transparency.

Do you think increased transparency will lead to more ethical AI development, or could it slow innovation? Let’s discuss how this could shape the future of AI and its responsible development!

Connect with Ajay Mago or any member of EM³’s Artificial Intelligence practice for professional support.

Ajay Mago is a former AmLaw 100 partner, with more than 16 years of experience in technology transactions, including at Jones Day, Mayer Brown, and Duane Morris. Mr. Mago advises on a wide array of sourcing, technology and other commercial transactions and helps companies navigate legal issues raised by data, emerging technologies, and digital transformation, both on the buyer and provider side. He routinely advises clients on IP strategy, management, and monetization arrangements, leveraging his technology background and business experience.