S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8195
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             October 27, 2023
                                ___________
 
 Introduced  by M. of A. VANEL -- read once and referred to the Committee
   on Science and Technology
 
 AN ACT to amend the state technology law and the criminal procedure law,
   in relation to advanced artificial intelligence systems (Part  A);  to
   amend  the state technology law, in relation to requiring registration
   and licensing of high-risk advanced  artificial  intelligence  systems
   and  related  provisions regarding the operation of such systems (Part
   B); to amend the state technology law, in relation to establishing the
   advanced artificial intelligence ethical code of conduct (Part C); and
   to amend the state technology law,  in  relation  to  prohibiting  the
   development  and  operation of certain artificial intelligence systems
   (Part D)
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Short  title. This act shall be known and may be cited as
 the "advanced artificial intelligence licensing act".
   § 2. Legislative findings and determinations. The  legislature  hereby
 finds  and declares that the transformative power of advanced artificial
 intelligence is likely to redefine nearly every  industry  and  society,
 bringing  with  it  the  potential for both immense benefits and serious
 risks.
   The legislature also finds and declares that excessive and  burdensome
 regulations  for advanced artificial intelligence can create significant
 adverse effects at both the state and national levels,  particularly  in
 regards to national security and economic stability. The balance between
 innovation  and  regulation,  if not maintained with care, can result in
 repercussions affecting the overall progress and well-being of society.
   The legislature additionally finds and declares that a balanced  regu-
 latory  framework, designed with a focus on non-intrusive safeguards for
 advanced artificial  intelligence,  has  the  capacity  to  curtail  bad

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD13008-03-3
 A. 8195                             2
              

 
 actors,  foster positive innovation, and secure the benefits of advanced
 artificial intelligence for both the state and its residents.
   §  3.  This  act enacts into law major components of legislation which
 are necessary to implement the "advanced artificial intelligence licens-
 ing act". Each component is wholly contained within a Part identified as
 Parts A through D. The effective  date  for  each  particular  provision
 contained  within  such  Part  is  set forth in the last section of such
 Part. Any provision in any section contained within  a  Part,  including
 the effective date of the Part, which makes a reference to a section "of
 this act", when used in connection with that particular component, shall
 be  deemed to mean and refer to the corresponding section of the Part in
 which it is found. Section five of  this  act  sets  forth  the  general
 effective date of this act.
 
                                  PART A
 
   Section 1. The state technology law is amended by adding a new article
 IV to read as follows:
                                ARTICLE IV
                 ADVANCED ARTIFICIAL INTELLIGENCE SYSTEMS
 SECTION 401. DEFINITIONS.
         402. POWERS AND DUTIES OF THE DEPARTMENT.
         403. FUNCTIONS, POWERS AND DUTIES OF THE SECRETARY.
         404. ADVISORY COUNCIL FOR ARTIFICIAL INTELLIGENCE.
         405. FUNCTIONS, POWERS AND DUTIES OF THE COUNCIL.
         406. RULEMAKING AUTHORITY.
         407. DISPOSITION OF MONEYS RECEIVED FOR LICENSE FEES.
         408. VIOLATIONS  OF  ARTIFICIAL INTELLIGENCE LAWS; PENALTIES AND
                INJUNCTIONS.
         409. FORMAL HEARINGS; NOTICE AND PROCEDURE.
   § 401. DEFINITIONS. AS USED IN THIS ARTICLE, THE FOLLOWING TERMS SHALL
 HAVE THE FOLLOWING MEANINGS:
   1. "ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM" SHALL  MEAN  ANY  DIGITAL
 APPLICATION  OR  SOFTWARE, WHETHER OR NOT INTEGRATED WITH PHYSICAL HARD-
 WARE, THAT AUTONOMOUSLY PERFORMS FUNCTIONS TRADITIONALLY REQUIRING HUMAN
 INTELLIGENCE. THIS INCLUDES, BUT IS NOT LIMITED TO THE SYSTEM:
   (A) HAVING THE ABILITY TO LEARN FROM AND ADAPT TO NEW  DATA  OR  SITU-
 ATIONS AUTONOMOUSLY; OR
   (B)  HAVING  THE  ABILITY  TO PERFORM FUNCTIONS THAT REQUIRE COGNITIVE
 PROCESSES SUCH AS UNDERSTANDING, LEARNING, OR DECISION-MAKING  FOR  EACH
 SPECIFIC TASK.
   2.  "HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM" SHALL MEAN ANY
 ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM THAT POSSESSES CAPABILITIES THAT
 CAN CAUSE SIGNIFICANT HARM TO  THE  LIBERTY,  EMOTIONAL,  PSYCHOLOGICAL,
 FINANCIAL,  PHYSICAL, OR PRIVACY INTERESTS OF AN INDIVIDUAL OR GROUPS OF
 INDIVIDUALS, OR  WHICH  HAVE  SIGNIFICANT  IMPLICATIONS  ON  GOVERNANCE,
 INFRASTRUCTURE,  OR  THE ENVIRONMENT. THE DIRECTOR SHALL ASSESS ANY SUCH
 PUBLIC OR PRIVATE SYSTEM IN DETERMINING  WHETHER  SUCH  SYSTEM  REQUIRES
 REGISTRATION.  HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEMS SHALL,
 AT  LEAST,  INCLUDE  SYSTEMS  THAT  ARE DESIGNED TO, WHETHER DIRECTLY OR
 INDIRECTLY, ON PURPOSE OR WITHOUT PURPOSE, DO THE FOLLOWING:
   (A) CAUSE MATERIAL HARM TO PERSONS, WILDLIFE, OR THE ENVIRONMENT;
   (B) MANAGE, CONTROL, OR SIGNIFICANTLY INFLUENCE HEALTHCARE OR  HEALTH-
 CARE-RELATED SYSTEMS, INCLUDING BUT NOT LIMITED TO, DIAGNOSIS, TREATMENT
 PLANS, PHARMACEUTICAL RECOMMENDATION, OR STORING OF PATIENT RECORDS;
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   (C)  OPERATE, CONTROL, OR GUIDE MOTOR VEHICLES, AIRCRAFT, OR ANY OTHER
 FORMS OF TRANSPORT WHICH, IF IT WERE TO MALFUNCTION, HAS A  HIGH  PROBA-
 BILITY OF POSING A RISK TO HUMAN SAFETY OR ENVIRONMENTAL INTEGRITY;
   (D)  PSYCHOLOGICALLY  PROFILE  INDIVIDUALS FOR THE PURPOSE OF TARGETED
 ADVERTISING, BEHAVIORAL PREDICTION, OR THE MANIPULATION OF USER  EXPERI-
 ENCES AND INTERACTIONS IN PRODUCTS OR SERVICES;
   (E)  MANAGE, CONTROL, OR CREATE CRITICAL INFRASTRUCTURE, INCLUDING BUT
 NOT LIMITED TO THE SUPPLY OF WATER, ELECTRICITY, GAS,  AND  HEATING,  OR
 CONSTRUCTION;
   (F)  FACILITATE,  CONTROL,  OR SIGNIFICANTLY IMPACT FINANCIAL SYSTEMS,
 INCLUDING BUT NOT LIMITED TO CONTROL OF STOCK EXCHANGES, STOCK  TRADING,
 CREDIT SCORING, OR OTHER ACTIVITIES WHERE INACCURACIES OR FAILURES COULD
 LEAD  TO  SUBSTANTIAL ECONOMIC HARM FOR INDIVIDUALS OR BROADER FINANCIAL
 INSTABILITY;
   (G) ASSIST, REPLACE, OR AUGMENT HUMAN DECISION-MAKING IN LAW  ENFORCE-
 MENT,  THE  JUDICIARY, THE EXECUTIVE, THE LEGISLATURE, OR ANY GOVERNMENT
 AGENCY;
   (H) ENABLE ADVANCED SURVEILLANCE CAPABILITIES;
   (I) INVOLVE THE USE OR DEVELOPMENT OF AUTONOMOUS WEAPONS SYSTEMS  THAT
 CAN  CAUSE  HARM,  DESTRUCTION, OR ENGAGE IN CONFLICT WITHOUT MEANINGFUL
 HUMAN INTERVENTION; AND
   (J) DECODE OR INTERPRET NEURAL OR COGNITIVE ACTIVITY.
   3. "SYSTEM" SHALL BE  USED  INTERCHANGEABLY  WITH  HIGH-RISK  ADVANCED
 ARTIFICIAL  INTELLIGENCE  SYSTEM  UNLESS  THE  CONTEXT  SHALL  OTHERWISE
 REQUIRE.
   4. "UNCONTAINED" SHALL MEAN THAT CRITICAL  COMPONENTS  OF  THE  SOURCE
 CODE  OF  A  HIGH-RISK  ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM THAT, IN
 SUBSTANTIALLY THEIR ORIGINAL FORM, HAVE BEEN REPRODUCED BY AN AMOUNT  OF
 INDIVIDUALS  SO  NUMEROUS THAT IT IS DEEMED TO BE PRACTICALLY IMPOSSIBLE
 TO PROHIBIT OR CONTROL ITS USAGE USING EXISTING  TECHNOLOGY.  THE  TERMS
 "CONTAIN" AND "CONTAINED" SHALL NOT BE CONSTRUED AS MEANING THE OPPOSITE
 OF UNCONTAINED.
   5.  "OPERATOR"  SHALL  MEAN THE PERSON WHO DISTRIBUTES AND HAS CONTROL
 OVER THE DEVELOPMENT OF A  HIGH-RISK  ADVANCED  ARTIFICIAL  INTELLIGENCE
 SYSTEM.    WHERE  A HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM IS
 PUBLICLY ACCESSIBLE CODE, THE OPERATOR SHALL BE DEEMED THE  PLATFORM  OR
 PLATFORMS WHICH HOST THE SYSTEM.
   6. "PUBLICLY ACCESSIBLE CODE" SHALL MEAN SOFTWARE WHOSE SOURCE CODE IS
 MADE AVAILABLE TO THE PUBLIC WHERE THE PUBLIC IS CAPABLE OF USING, MODI-
 FYING,  OR  DISTRIBUTING  THE SOURCE CODE IRRESPECTIVE OF THE ASSOCIATED
 COSTS TO USE, MODIFY, OR DISTRIBUTE THE SOURCE  CODE,  IF  ANY,  OR  THE
 UNDERLYING LICENSE AGREEMENT OR RIGHTS TO USE, MODIFY, OR DISTRIBUTE THE
 SOURCE CODE.
   7. "SECRETARY" SHALL MEAN THE SECRETARY OF STATE.
   8. "DEPARTMENT" SHALL MEAN THE DEPARTMENT OF STATE.
   9.  "COUNCIL"  SHALL MEAN THE ADVISORY COUNCIL FOR ARTIFICIAL INTELLI-
 GENCE ESTABLISHED PURSUANT TO SECTION FOUR HUNDRED FOUR OF THIS ARTICLE.
   10. "PERSON" SHALL MEAN ANY INDIVIDUAL, GROUP OF INDIVIDUALS, PARTNER-
 SHIP, CORPORATION, ASSOCIATION OR ANY OTHER ENTITY.
   § 402. POWERS AND DUTIES OF THE DEPARTMENT. THE DEPARTMENT SHALL  HAVE
 THE FOLLOWING FUNCTIONS, POWERS AND DUTIES:
   1.  DISCRETION TO ISSUE OR REFUSE TO ISSUE ANY LICENSE PROVIDED FOR IN
 THIS ARTICLE  IN  ACCORDANCE  WITH  THE  RELEVANT  PROVISIONS  FOR  EACH
 LICENSE.
   2. TO REVOKE, CANCEL OR SUSPEND, AFTER NOTICE AND AN OPPORTUNITY TO BE
 HEARD, EXCEPT WHERE IMMEDIATE REVOCATION, CANCELLATION, OR SUSPENSION IS
 A. 8195                             4
 
 NECESSARY  TO  PROTECT THE PUBLIC, ANY LICENSE ISSUED UNDER THIS ARTICLE
 FOR A VIOLATION OF THIS ARTICLE OR ANY REGULATION PURSUANT THERETO.
   3.  TO  IMPOSE  OR  RECOVER  A CIVIL OR CRIMINAL PENALTY, AS OTHERWISE
 AUTHORIZED UNDER THIS ARTICLE, AGAINST ANY PERSON FOUND TO HAVE VIOLATED
 ANY PROVISION OF THIS ARTICLE, WHETHER OR NOT A LICENSE HAS BEEN  ISSUED
 TO SUCH PERSON PURSUANT TO THIS ARTICLE.
   4.  TO  PROMULGATE  RULES AND REGULATIONS IN ACCORDANCE WITH STATUTORY
 GRANTS OF AUTHORITY PURSUANT TO THIS ARTICLE.
   5. TO HOLD HEARINGS,  SUBPOENA  WITNESSES,  COMPEL  THEIR  ATTENDANCE,
 ADMINISTER  OATHS,  TO  EXAMINE  ANY PERSON UNDER OATH AND IN CONNECTION
 THEREWITH TO REQUIRE THE PRODUCTION OF ANY  BOOKS,  RECORDS,  DOCUMENTS,
 SOURCE CODE OR LOGS RELATIVE TO AN INQUIRY PURSUANT TO THE PROVISIONS OF
 THIS  ARTICLE.  A  SUBPOENA ISSUED PURSUANT TO THIS SUBDIVISION SHALL BE
 SUBJECT TO THE PROVISIONS OF THE CRIMINAL PROCEDURE LAW.
   6. TO APPOINT ANY NECESSARY DEPUTIES, COUNSELS,  ASSISTANTS,  INVESTI-
 GATORS,  AND OTHER EMPLOYEES TO CARRY OUT THE PROVISIONS OF THIS ARTICLE
 WITHIN THE LIMITS PROVIDED  BY  APPROPRIATION.  DEPUTIES,  COUNSELS  AND
 CONFIDENTIAL  SECRETARIES  TO  DEPARTMENT MEMBERS SHALL BE IN THE EXEMPT
 CLASS OF THE CIVIL SERVICE.  THE  OTHER  ASSISTANTS,  INVESTIGATORS  AND
 EMPLOYEES OF THE DEPARTMENT EMPLOYED TO CARRY OUT THE PROVISIONS OF THIS
 ARTICLE  SHALL  ALL BE IN THE COMPETITIVE CLASS OF THE CIVIL SERVICE AND
 SHALL BE CONSIDERED FOR  PURPOSES  OF  ARTICLE  FOURTEEN  OF  THE  CIVIL
 SERVICE  LAW  TO BE PUBLIC EMPLOYEES OF THE STATE, AND SHALL BE ASSIGNED
 TO THE APPROPRIATE COLLECTIVE BARGAINING UNIT. INVESTIGATORS SO EMPLOYED
 BY THE DEPARTMENT SHALL BE DEEMED TO BE  PEACE  OFFICERS  ONLY  FOR  THE
 PURPOSES  OF  ENFORCING  THE  PROVISIONS OF THIS ARTICLE OR JUDGMENTS OR
 ORDERS OBTAINED FOR VIOLATION THEREOF, WITH ALL THE POWERS SET FORTH  IN
 SECTION 2.20 OF THE CRIMINAL PROCEDURE LAW.
   7.  TO PRESCRIBE FORMS OF APPLICATIONS FOR LICENSES UNDER THIS ARTICLE
 AND OF ALL REPORTS DEEMED NECESSARY BY THE DEPARTMENT.
   8. TO APPOINT SUCH ADVISORY GROUPS AND COMMITTEES AS DEEMED  NECESSARY
 TO  PROVIDE  ASSISTANCE  TO THE DEPARTMENT TO CARRY OUT THE PURPOSES AND
 OBJECTIVES OF THIS ARTICLE.
   9. TO ENTER INTO CONTRACTS, MEMORANDA OF UNDERSTANDING, AND AGREEMENTS
 AS DEEMED APPROPRIATE TO EFFECTUATE THE POLICY AND PURPOSE OF THIS ARTI-
 CLE.
   10. IF PUBLIC HEALTH, SAFETY, OR WELFARE IMPERATIVELY  REQUIRES  EMER-
 GENCY  ACTION,  AND  INCORPORATES  A FINDING TO THAT EFFECT IN AN ORDER,
 SUMMARY SUSPENSION OF A LICENSE ISSUED PURSUANT TO THIS ARTICLE  MAY  BE
 ORDERED,  EFFECTIVE  ON THE DATE SPECIFIED IN SUCH ORDER OR UPON SERVICE
 OF A CERTIFIED COPY OF SUCH ORDER ON THE LICENSEE,  WHICHEVER  SHALL  BE
 LATER,  PENDING  PROCEEDINGS  FOR  REVOCATION  OR  OTHER  ACTION.  THESE
 PROCEEDINGS SHALL BE PROMPTLY INSTITUTED AND  DETERMINED.  IN  ADDITION,
 THE DEPARTMENT MAY ORDER THE ADMINISTRATIVE SEIZURE OF SERVICES, ISSUE A
 STOP ORDER, OR TAKE ANY OTHER ACTION NECESSARY TO EFFECTUATE AND ENFORCE
 THE POLICIES AND PURPOSES OF THIS ARTICLE.
   11.  TO  DRAFT,  PROVIDE  FOR  PUBLIC COMMENT ON AND ISSUE DECLARATORY
 RULINGS, GUIDANCE AND INDUSTRY ADVISORIES.
   12. WHEN AN ADMINISTRATIVE DECISION IS APPEALED TO THE  DEPARTMENT  BY
 AN  APPLICANT,  REGISTERED  ORGANIZATION, LICENSEE OR PERMITTEE, ISSUE A
 FINAL DETERMINATION OF THE DEPARTMENT.
   § 403. FUNCTIONS, POWERS AND DUTIES OF THE  SECRETARY.  THE  SECRETARY
 SHALL HAVE THE FOLLOWING FUNCTIONS, POWERS AND DUTIES:
   1.  TO  EXERCISE  THE POWERS AND PERFORM THE DUTIES IN RELATION TO THE
 ADMINISTRATION OF THE PROVISIONS OF THIS ARTICLE.
 A. 8195                             5
 
   2. TO KEEP RECORDS IN SUCH FORM AS HE OR  SHE  MAY  PRESCRIBE  OF  ALL
 REGISTRATIONS  AND  LICENSES  ISSUED  AND REVOKED WITHIN THE STATE; SUCH
 RECORDS SHALL BE SO KEPT AS TO PROVIDE READY INFORMATION AS TO THE IDEN-
 TITY OF ALL LICENSEES INCLUDING THE NAMES OF THE OFFICERS AND  DIRECTORS
 OF  CORPORATE LICENSEES. THE SECRETARY MAY CONTRACT TO FURNISH COPIES OF
 THE RECORDS OF LICENSES ISSUED WITHIN THE STATE OR ANY POLITICAL  SUBDI-
 VISION THEREOF, FOR ANY LICENSE YEAR OR TERM OF YEARS NOT EXCEEDING FIVE
 YEARS.
   3.  TO PRESCRIBE FORMS OF APPLICATIONS FOR LICENSES UNDER THIS ARTICLE
 AND OF ALL REPORTS DEEMED NECESSARY BY THE DEPARTMENT.
   4. TO DELEGATE THE POWERS PROVIDED IN THIS SECTION TO SUCH OTHER OFFI-
 CERS OR EMPLOYEES AS MAY BE DEEMED APPROPRIATE BY THE SECRETARY.
   5. TO ENTER INTO CONTRACTS, MEMORANDA OF UNDERSTANDING AND  AGREEMENTS
 TO EFFECTUATE THE POLICY AND PURPOSE OF THIS ARTICLE.
   6.  TO  ADVISE  AND  ASSIST  THE DEPARTMENT IN CARRYING OUT ANY OF ITS
 FUNCTIONS, POWERS AND DUTIES.
   7. TO COORDINATE ACROSS STATE AGENCIES AND  DEPARTMENTS  IN  ORDER  TO
 RESEARCH AND STUDY ARTIFICIAL INTELLIGENCE AND THE IMPACT IT MAY HAVE ON
 VARIOUS INDUSTRIES AND SUBJECT MATTERS.
   8. TO ISSUE GUIDANCE AND INDUSTRY ADVISORIES.
   9.  TO CREATE AND MAINTAIN A PUBLICLY AVAILABLE DIRECTORY OF THE NAMES
 AND LOCATIONS OF PERSONS LICENSED PURSUANT TO THIS ARTICLE.
   10. TO CREATE A SYSTEM WHEREBY PERSONS LICENSED UNDER THIS ARTICLE CAN
 CONFIRM THE LICENSE OF ANOTHER  PERSON  FOR  THE  PURPOSES  OF  ENSURING
 COMPLIANCE WITH THIS ARTICLE.
   § 404. ADVISORY COUNCIL FOR ARTIFICIAL INTELLIGENCE. 1. THERE SHALL BE
 AN  ADVISORY  COUNCIL  FOR  ARTIFICIAL INTELLIGENCE. THE SECRETARY SHALL
 SERVE AS CHAIR OF THE COUNCIL. THE REMAINDER OF  THE  COUNCIL  SHALL  BE
 COMPOSED AS FOLLOWS:
   (A)  TWO  MEMBERS OF THE ARTIFICIAL INTELLIGENCE INDUSTRY APPOINTED BY
 THE GOVERNOR;
   (B) ONE MEMBER OF THE ARTIFICIAL INTELLIGENCE  INDUSTRY  APPOINTED  BY
 THE TEMPORARY PRESIDENT OF THE SENATE;
   (C)  ONE  MEMBER  OF THE ARTIFICIAL INTELLIGENCE INDUSTRY APPOINTED BY
 THE SPEAKER OF THE ASSEMBLY;
   (D) THE COMMISSIONER OF ENVIRONMENTAL CONSERVATION;
   (E) THE SUPERINTENDENT OF FINANCIAL SERVICES;
   (F) THE COMMISSIONER OF HEALTH;
   (G) THE COMMISSIONER OF LABOR;
   (H) THE COMMISSIONER OF TRANSPORTATION;
   (I) THE COMMISSIONER OF THE DIVISION OF HUMAN RIGHTS;
   (J) THE SUPERINTENDENT OF STATE POLICE;
   (K) THE ATTORNEY GENERAL;
   (L) THE STATE COMPTROLLER;
   (M) THE COMMISSIONER OF THE DIVISION OF HOMELAND SECURITY AND EMERGEN-
 CY SERVICES; AND
   (N) THE DIRECTOR OF THE OFFICE OF INFORMATION TECHNOLOGY SERVICES.
   2. THE MEMBERS OF THE COUNCIL SHALL RECEIVE NO COMPENSATION FOR  THEIR
 SERVICES,  BUT  SHALL  BE  ALLOWED  THEIR  ACTUAL AND NECESSARY EXPENSES
 INCURRED IN THE PERFORMANCE OF THEIR DUTIES.
   § 405. FUNCTIONS, POWERS AND DUTIES OF THE COUNCIL. THE COUNCIL  SHALL
 HAVE THE FOLLOWING FUNCTIONS, POWERS AND DUTIES:
   1.  TO  REVIEW AND COMMENT ON ALL RULES AND REGULATIONS OF THE DEPART-
 MENT;
   2. TO ISSUE NON-BINDING RECOMMENDATIONS ON WHETHER TO GRANT A  LICENSE
 UNDER  THIS  ARTICLE, WHAT CHANGES NEED TO BE MADE BY AN APPLICANT FOR A
 A. 8195                             6
 
 LICENSE IN ORDER TO BE GRANTED A LICENSE, WHAT CHANGES NEED TO  BE  MADE
 IN  ORDER  FOR AN OPERATOR TO PUBLICLY IMPLEMENT MODIFICATIONS, UPDATES,
 UPGRADES, AND REWRITES TO AN OPERATOR'S SOURCE CODE,  AND  WHAT  CHANGES
 NEED TO BE MADE TO AN OPERATOR'S SYSTEM IN ORDER TO MAINTAIN SUCH OPERA-
 TOR'S LICENSE; AND
   3. TO PERFORM SUCH OTHER ACTS AS MAY BE ASSIGNED BY THE CHAIRPERSON OF
 THE  COUNCIL  WHICH  ARE NECESSARY OR APPROPRIATE TO CARRY OUT THE FUNC-
 TIONS OF THE COUNCIL.
   § 406. RULEMAKING AUTHORITY. 1.  THE  DEPARTMENT  SHALL  PERFORM  SUCH
 ACTS,  PRESCRIBE  SUCH  FORMS  AND  PROPOSE  SUCH RULES, REGULATIONS AND
 ORDERS AS IT MAY DEEM  NECESSARY  OR  PROPER  TO  FULLY  EFFECTUATE  THE
 PROVISIONS OF THIS ARTICLE.
   2.  THE  DEPARTMENT SHALL, IN CONSULTATION WITH THE DIRECTOR, HAVE THE
 AUTHORITY TO PROMULGATE ANY AND  ALL  NECESSARY  RULES  AND  REGULATIONS
 GOVERNING  THE USE, CONTROL, AND PROHIBITED ACTIVITIES OF ADVANCED ARTI-
 FICIAL INTELLIGENCE SYSTEMS AS WELL AS,  HEARING  PROCEDURES  AND  ADDI-
 TIONAL  CAUSES  FOR  CANCELLATION,  SUSPENSION, REVOCATION, AND/OR CIVIL
 PENALTIES AGAINST ANY PERSON LICENSED BY THE DEPARTMENT AND THE  CIRCUM-
 STANCES,  MANNER  AND PROCESS BY WHICH A LICENSEE MAY APPLY TO CHANGE OR
 ALTER ITS APPLICATION.
   3. THE DEPARTMENT SHALL PROMULGATE  RULES  AND  REGULATIONS  THAT  ARE
 DESIGNED TO:
   (A)  PREVENT  THE  CREATION  AND  PROLIFERATION OF ADVANCED ARTIFICIAL
 INTELLIGENCE SYSTEMS THAT POSSESS THE ABILITY TO CAUSE SUBSTANTIAL  HARM
 TO  MEMBERS  OF THE PUBLIC, SOCIETY AT LARGE, OR THE ENVIRONMENT WITHOUT
 JUSTIFICATION;
   (B) PREVENT THE UNCONTAINMENT OF  PROHIBITED  AND  HIGH-RISK  ADVANCED
 ARTIFICIAL INTELLIGENCE SYSTEMS;
   (C)  PREVENT  THE  USE OF PROHIBITED AND UNLICENSED HIGH-RISK ADVANCED
 ARTIFICIAL INTELLIGENCE SYSTEMS FROM THIS STATE TO OTHER STATES AND FROM
 OTHER STATES INTO THIS STATE;
   (D) EDUCATE AND INFORM THE PUBLIC ABOUT  ARTIFICIAL  INTELLIGENCE  AND
 THE BENEFITS AND RISKS IT POSES;
   (E)  INFORM  THE  PUBLIC ABOUT THE PROHIBITION ON UNLICENSED HIGH-RISK
 ADVANCED ARTIFICIAL INTELLIGENCE SYSTEMS AND PROHIBITED ADVANCED ARTIFI-
 CIAL INTELLIGENCE SYSTEMS; AND
   (F) ESTABLISH APPLICATION AND LICENSING  PROCESSES  WHICH  ENSURE  ALL
 MATERIAL OWNERS AND INTEREST HOLDERS ARE DISCLOSED AND THAT OFFICIALS OR
 OTHER  INDIVIDUALS  WITH  CONTROL OVER THE APPROVAL OF AN APPLICATION OR
 LICENSE DO NOT  THEMSELVES  HAVE  ANY  INTEREST  IN  AN  APPLICATION  OR
 LICENSE.
   4.  IN  ADOPTING  ANY EMERGENCY RULE, THE DEPARTMENT SHALL COMPLY WITH
 THE PROVISIONS OF SUBDIVISION SIX OF SECTION  TWO  HUNDRED  TWO  OF  THE
 STATE  ADMINISTRATIVE PROCEDURE ACT AND SUBDIVISION THREE OF SECTION ONE
 HUNDRED ONE-A OF THE EXECUTIVE LAW;  PROVIDED,  HOWEVER,  THAT  NOTWITH-
 STANDING THE PROVISIONS OF SUCH LAWS:
   (A)  SUCH EMERGENCY RULE SHALL REMAIN IN EFFECT FOR NO LONGER THAN ONE
 HUNDRED TWENTY DAYS, UNLESS WITHIN SUCH  TIME  THE  DEPARTMENT  COMPLIES
 WITH  THE  PROVISIONS  OF  SUCH  LAWS AND ADOPTS THE RULE AS A PERMANENT
 RULE;
   (B) IF, PRIOR TO THE EXPIRATION OF A RULE  ADOPTED  PURSUANT  TO  THIS
 SUBDIVISION, THE DEPARTMENT FINDS THAT THE READOPTION OF SUCH RULE ON AN
 EMERGENCY  BASIS  OR  THE ADOPTION OF A SUBSTANTIALLY SIMILAR RULE ON AN
 EMERGENCY BASIS IS NECESSARY FOR THE PRESERVATION OF THE PUBLIC  HEALTH,
 SAFETY OR GENERAL WELFARE THE DEPARTMENT MAY ONLY READOPT THE RULE ON AN
 EMERGENCY  BASIS  OR  ADOPT A SUBSTANTIALLY SIMILAR RULE ON AN EMERGENCY
 A. 8195                             7
 
 BASIS IF ON OR BEFORE THE DATE OF SUCH ACTION THE  DEPARTMENT  HAS  ALSO
 SUBMITTED A NOTICE OF PROPOSED RULEMAKING PURSUANT TO SUBDIVISION SIX OF
 SECTION  TWO  HUNDRED  TWO OF THE STATE ADMINISTRATIVE PROCEDURE ACT AND
 SUBDIVISION  THREE OF SECTION ONE HUNDRED ONE-A OF THE EXECUTIVE LAW. AN
 EMERGENCY RULE ADOPTED PURSUANT TO THIS PARAGRAPH MAY REMAIN  IN  EFFECT
 FOR NO LONGER THAN ONE HUNDRED TWENTY DAYS;
   (C)  AN  EMERGENCY  RULE  ADOPTED  PURSUANT  TO  THIS SUBDIVISION OR A
 SUBSTANTIALLY SIMILAR RULE ADOPTED ON AN EMERGENCY BASIS MAY  REMAIN  IN
 EFFECT  FOR NO LONGER THAN ONE HUNDRED TWENTY DAYS, BUT UPON THE EXPIRA-
 TION OF SUCH ONE HUNDRED TWENTY-DAY PERIOD  NO  FURTHER  READOPTIONS  OR
 ADOPTIONS OF SUBSTANTIALLY SIMILAR RULES SHALL BE PERMITTED FOR A PERIOD
 OF  ONE  HUNDRED TWENTY DAYS. NOTHING IN THIS SUBDIVISION SHALL PRECLUDE
 THE ADOPTION OF SUCH RULE BY SUBMITTING A NOTICE OF ADOPTION PURSUANT TO
 SUBDIVISION FIVE OF SECTION TWO HUNDRED TWO OF THE STATE  ADMINISTRATIVE
 PROCEDURE ACT; AND
   (D) STRICT COMPLIANCE WITH THE PROVISIONS OF THIS SUBDIVISION SHALL BE
 REQUIRED, AND ANY EMERGENCY RULE OR SUBSTANTIALLY SIMILAR RULE THAT DOES
 NOT SO COMPLY SHALL BE VOID AND OF NO LEGAL EFFECT.
   5.  THE  DEPARTMENT SHALL HAVE THE AUTHORITY TO PROMULGATE REGULATIONS
 GOVERNING THE APPROPRIATE USE AND LICENSURE OF THE DEVELOPMENT OF  HIGH-
 RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEMS.
   § 407. DISPOSITION OF MONEYS RECEIVED FOR LICENSE FEES. THE DEPARTMENT
 SHALL  ESTABLISH  A  SCALE  OF APPLICATION, LICENSING, AND RENEWAL FEES,
 BASED UPON THE COST OF ENFORCING THIS ARTICLE, THE SIZE OF THE  BUSINESS
 BEING LICENSED, AND THE RISK IT POSES AS FOLLOWS:
   1.  THE  DEPARTMENT  SHALL  CHARGE  EACH LICENSEE A LICENSURE FEE, AND
 RENEWAL FEE, AS APPLICABLE. THE FEES MAY VARY DEPENDING UPON THE  NATURE
 AND SCOPE OF THE DIFFERENT REGISTRATION, LICENSURE ACTIVITIES.
   2. THE TOTAL FEES ASSESSED PURSUANT TO THIS ARTICLE SHALL BE SET AT AN
 AMOUNT  THAT  SHALL  GENERATE SUFFICIENT TOTAL REVENUE TO, AT A MINIMUM,
 FULLY COVER THE TOTAL COSTS OF ADMINISTERING THIS ARTICLE.
   § 408. VIOLATIONS  OF  ARTIFICIAL  INTELLIGENCE  LAWS;  PENALTIES  AND
 INJUNCTIONS. 1. ANY PERSON WHO VIOLATES, DISOBEYS OR DISREGARDS ANY TERM
 OR  PROVISION  OF  THIS  ARTICLE OR OF ANY LAWFUL NOTICE, ORDER OR REGU-
 LATION PURSUANT THERETO FOR WHICH A CIVIL OR  CRIMINAL  PENALTY  IS  NOT
 OTHERWISE  EXPRESSLY  PRESCRIBED IN THIS ARTICLE BY LAW, SHALL BE LIABLE
 TO THE PEOPLE OF THE STATE FOR A CIVIL PENALTY  OF  NOT  TO  EXCEED  THE
 AMOUNT  GAINED FROM SUCH VIOLATION, OR THE ACTUAL DAMAGES CAUSED BY SUCH
 VIOLATION WHICHEVER IS GREATER. IN ASSESSING  THE  CIVIL  PENALTY  UNDER
 THIS  SUBDIVISION,  THE DEPARTMENT, AS MAY BE APPLICABLE SHALL TAKE INTO
 CONSIDERATION THE NATURE OF SUCH VIOLATION AND SHALL  ASSESS  A  PENALTY
 THAT IS PROPORTIONATE TO THE VIOLATION.
   2.  THE  PENALTY PROVIDED FOR IN SUBDIVISION ONE OF THIS SECTION SHALL
 BE RECOVERED BY AN ACTION OR PROCEEDING IN A COURT OF  COMPETENT  JURIS-
 DICTION  BROUGHT  BY  THE  DEPARTMENT,  AS  MAY BE APPLICABLE, OR BY THE
 ATTORNEY GENERAL AT THE REQUEST OF THE DEPARTMENT.
   3. SUCH CIVIL PENALTY MAY BE RELEASED OR COMPROMISED  BY  THE  DEPART-
 MENT,  AS  MAY BE APPLICABLE, BEFORE THE MATTER HAS BEEN REFERRED TO THE
 ATTORNEY GENERAL, AND WHERE SUCH MATTER HAS BEEN REFERRED TO THE  ATTOR-
 NEY  GENERAL,  ANY  SUCH  PENALTY MAY BE RELEASED OR COMPROMISED AND ANY
 ACTION OR PROCEEDING COMMENCED TO RECOVER THE SAME MAY  BE  SETTLED  AND
 DISCONTINUED BY THE ATTORNEY GENERAL WITH THE CONSENT OF THE DEPARTMENT.
   4.  IT  SHALL  BE THE DUTY OF THE ATTORNEY GENERAL UPON THE REQUEST OF
 THE DEPARTMENT, AS MAY BE APPLICABLE, TO BRING AN ACTION  OR  PROCEEDING
 AGAINST  ANY  PERSON  WHO  VIOLATES,  DISOBEYS OR DISREGARDS ANY TERM OR
 PROVISION OF THIS ARTICLE OR OF ANY LAWFUL NOTICE, ORDER  OR  REGULATION
 A. 8195                             8

 PURSUANT THERETO FOR ANY RELIEF AUTHORIZED UNDER THIS ARTICLE, INCLUDING
 EQUITABLE  AND/OR INJUNCTIVE RELIEF AND THE RECOVERY OF CIVIL PENALTIES;
 PROVIDED, HOWEVER, THAT THE DEPARTMENT OR THE  SECRETARY  SHALL  FURNISH
 THE  ATTORNEY GENERAL WITH SUCH MATERIAL, EVIDENTIARY MATTER OR PROOF AS
 MAY BE REQUESTED BY THE ATTORNEY GENERAL FOR THE PROSECUTION OF SUCH  AN
 ACTION OR PROCEEDING.
   5. IT IS THE PURPOSE OF THIS SECTION TO PROVIDE ADDITIONAL AND CUMULA-
 TIVE  REMEDIES,  AND  NOTHING  HEREIN  CONTAINED  SHALL ABRIDGE OR ALTER
 RIGHTS OF ACTION OR REMEDIES NOW OR HEREAFTER EXISTING,  NOR  SHALL  ANY
 PROVISION  OF  THIS  SECTION,  NOR  ANY  ACTION  DONE  BY VIRTUE OF THIS
 SECTION, BE CONSTRUED AS ESTOPPING THE STATE, PERSONS OR  MUNICIPALITIES
 IN THE EXERCISING OF THEIR RESPECTIVE RIGHTS.
   6.  THE  DEPARTMENT  SHALL  FORWARD  ANY FINAL FINDINGS OF A VIOLATION
 UNDER THIS ARTICLE TO ANY OTHER STATEWIDE LICENSING  AGENCY  WHERE  SUCH
 FINDINGS WERE ENTERED AGAINST A BUSINESS HOLDING ANY OTHER SUCH LICENSE,
 FOR  ANY SUCH OTHER LICENSING AGENCY TO REVIEW THE FINDINGS TO DETERMINE
 IF THERE HAS BEEN A VIOLATION OF ANY SUCH LICENSE ISSUED BY SUCH AGENCY.
   § 409. FORMAL HEARINGS; NOTICE AND PROCEDURE. 1.  THE  DEPARTMENT,  OR
 ANY  PERSON DESIGNATED BY THEM FOR THIS PURPOSE, MAY ISSUE SUBPOENAS AND
 ADMINISTER OATHS IN CONNECTION WITH ANY HEARING OR  INVESTIGATION  UNDER
 OR  PURSUANT TO THIS ARTICLE, AND IT SHALL BE THE DUTY OF THE DEPARTMENT
 AND ANY PERSONS DESIGNATED BY THEM FOR SUCH PURPOSE TO  ISSUE  SUBPOENAS
 AT THE REQUEST OF AND UPON BEHALF OF THE RESPONDENT.
   2.  THE  DEPARTMENT AND THOSE DESIGNATED BY THEM SHALL NOT BE BOUND BY
 THE LAWS OF EVIDENCE IN THE CONDUCT  OF  HEARING  PROCEEDINGS,  BUT  THE
 DETERMINATION SHALL BE FOUNDED UPON PREPONDERANCE OF EVIDENCE TO SUSTAIN
 IT.
   3. NOTICE AND RIGHT OF HEARING AS PROVIDED IN THE STATE ADMINISTRATIVE
 PROCEDURE ACT SHALL BE SERVED AT LEAST FIFTEEN DAYS PRIOR TO THE DATE OF
 THE  HEARING,  PROVIDED  THAT,  WHENEVER BECAUSE OF DANGER TO THE PUBLIC
 HEALTH, SAFETY OR WELFARE IT APPEARS PREJUDICIAL TO THE INTERESTS OF THE
 PEOPLE OF THE STATE TO DELAY ACTION FOR FIFTEEN DAYS OR  WHEN  NECESSARY
 FOR  THE  PRESERVATION  OF THE PUBLIC HEALTH, SAFETY OR GENERAL WELFARE,
 THE OFFICE MAY SERVE THE RESPONDENT  WITH  AN  ORDER  REQUIRING  CERTAIN
 ACTION  OR  THE  CESSATION OF CERTAIN ACTIVITIES IMMEDIATELY OR WITHIN A
 SPECIFIED PERIOD OF LESS THAN FIFTEEN DAYS.
   4. SERVICE OF NOTICE OF HEARING OR ORDER SHALL  BE  MADE  BY  PERSONAL
 SERVICE  OR  BY  REGISTERED OR CERTIFIED MAIL. WHERE SERVICE, WHETHER BY
 PERSONAL SERVICE OR BY REGISTERED OR CERTIFIED MAIL,  IS  MADE  UPON  AN
 INCOMPETENT  INDIVIDUAL,  PARTNERSHIP,  OR CORPORATION, IT SHALL BE MADE
 UPON THE PERSON OR PERSONS DESIGNATED TO  RECEIVE  PERSONAL  SERVICE  BY
 ARTICLE THREE OF THE CIVIL PRACTICE LAW AND RULES.
   5.  AT  A  HEARING,  THAT  TO THE GREATEST EXTENT PRACTICABLE SHALL BE
 REASONABLY NEAR THE RESPONDENT, THE RESPONDENT  MAY  APPEAR  PERSONALLY,
 SHALL HAVE THE RIGHT OF COUNSEL, AND MAY CROSS-EXAMINE WITNESSES AGAINST
 HIM OR HER AND PRODUCE EVIDENCE AND WITNESSES ON HIS OR HER BEHALF.
   6.  FOLLOWING  A HEARING, THE DEPARTMENT MAY MAKE APPROPRIATE DETERMI-
 NATIONS AND ISSUE A FINAL ORDER IN ACCORDANCE THEREWITH. THE  RESPONDENT
 SHALL  HAVE THIRTY DAYS TO SUBMIT A WRITTEN APPEAL TO THE DEPARTMENT. IF
 THE RESPONDENT DOES NOT SUBMIT A WRITTEN APPEAL WITHIN  THIRTY  DAYS  OF
 THE DETERMINATION OF THE DEPARTMENT THE ORDER SHALL BE FINAL.
   7. THE DEPARTMENT MAY ADOPT, AMEND AND REPEAL ADMINISTRATIVE RULES AND
 REGULATIONS  GOVERNING  THE  PROCEDURES  TO  BE FOLLOWED WITH RESPECT TO
 HEARINGS, INVESTIGATIONS, AND OTHER ADMINISTRATIVE  ENFORCEMENT  ACTIONS
 TAKEN  PURSUANT  TO THIS ARTICLE, INCLUDING ANY SUCH ENFORCEMENT ACTIONS
 TAKEN AGAINST PERSONS NOT LICENSED UNDER THIS ARTICLE. SUCH RULES  SHALL
 A. 8195                             9
 
 BE CONSISTENT WITH THE POLICY AND PURPOSE OF THIS ARTICLE AND THE EFFEC-
 TIVE AND FAIR ENFORCEMENT OF ITS PROVISIONS.
   8.  THE PROVISIONS OF THIS SECTION SHALL BE APPLICABLE TO ALL HEARINGS
 HELD PURSUANT TO THIS ARTICLE, EXCEPT WHERE  OTHER  PROVISIONS  OF  THIS
 ARTICLE  APPLICABLE  THERETO  ARE INCONSISTENT THEREWITH, IN WHICH EVENT
 SUCH OTHER PROVISIONS SHALL APPLY.
   § 2. Section 2.10 of the criminal procedure law is amended by adding a
 new subdivision 87 to read as follows:
   87. INVESTIGATORS APPOINTED BY THE DEPARTMENT OF  STATE,  PURSUANT  TO
 SECTION FOUR HUNDRED TWO OF THE STATE TECHNOLOGY LAW; PROVIDED, HOWEVER,
 THAT NOTHING IN THIS SUBDIVISION SHALL BE DEEMED TO AUTHORIZE SUCH OFFI-
 CER TO CARRY, POSSESS, REPAIR, OR DISPOSE OF A FIREARM UNLESS THE APPRO-
 PRIATE  LICENSE  THEREFOR  HAS BEEN ISSUED PURSUANT TO SECTION 400.00 OF
 THE PENAL LAW.
   § 3. This act shall take effect on the one hundred eightieth day after
 it shall have become a law. Effective immediately, the addition,  amend-
 ment and/or repeal of any rule or regulation necessary for the implemen-
 tation  of  this act on its effective date are authorized to be made and
 completed on or before such effective date.
 
                                  PART B

   Section 1. The state technology law is amended by  adding  twenty  new
 sections  410,  411,  412,  413, 414, 415, 416, 417, 418, 419, 420, 421,
 422, 423, 424, 425, 426, 427, 428 and 431 to read as follows:
   § 410. DUTY TO REGISTER A HIGH-RISK ADVANCED  ARTIFICIAL  INTELLIGENCE
 SYSTEM.  1.  ANY  PERSON  WHO  DEVELOPS  A HIGH-RISK ADVANCED ARTIFICIAL
 INTELLIGENCE SYSTEM, WHETHER IN WHOLE OR IN PART, IN THE STATE  THAT  IS
 PRESENTLY  PERFORMING  FUNCTIONS  FOR ITS INTENDED PURPOSE OR WITHIN ITS
 DESIGNATED OPERATIONAL PARAMETERS, SHALL HAVE THE DUTY TO  DISCLOSE  THE
 EXISTENCE AND FUNCTION OF SAID SYSTEM TO THE SECRETARY BY APPLYING FOR A
 LICENSE  AS  REQUIRED  UNDER SECTION FOUR HUNDRED ELEVEN OF THIS ARTICLE
 OR, WHERE APPLICABLE, A SUPPLEMENTAL LICENSE UNDER SECTION FOUR  HUNDRED
 TWELVE  OF THIS ARTICLE. THIS DUTY TO DISCLOSE SHALL BE TRIGGERED BY THE
 SYSTEM'S ACTIVE DEPLOYMENT AND USAGE IN ITS INTENDED CONTEXT OR FIELD OF
 OPERATION AND IS APPLICABLE IRRESPECTIVE OF  THE  SYSTEM'S  LOCATION  OF
 OPERATION.    THIS DUTY EXTENDS TO ANY UPDATES, MODIFICATIONS, UPGRADES,
 OR EXPANSIONS OF THE SYSTEM'S CAPABILITIES OR INTENDED USES.
   2. ANY PERSON DEVELOPING A SYSTEM  AS  DEFINED  IN  PARAGRAPH  (I)  OF
 SUBDIVISION  TWO  OF SECTION FOUR HUNDRED ONE OF THIS ARTICLE WITHIN THE
 STATE SHALL DISCLOSE IN WRITING TO THE SECRETARY THE DEVELOPMENT OF SUCH
 A SYSTEM PRIOR TO ACTIVE DEVELOPMENT OF THE SYSTEM. SUCH  WRITING  SHALL
 SET  FORTH THE NAMES AND ADDRESSES OF ALL PERSONS INVOLVED IN THE DEVEL-
 OPMENT OF SUCH SYSTEM, A DESCRIPTION OF THE SYSTEM,  THE  SYSTEMS  FUNC-
 TIONS  AND INTENDED USE CASES, AND MEASURES THAT WILL BE TAKEN TO ENSURE
 THAT ANY RISKS POSED BY THE SYSTEM ARE  MITIGATED.  THE  SECRETARY  MAY,
 UPON  RECEIPT  OF SUCH WRITING, REQUIRE SUCH PERSON TO CEASE DEVELOPMENT
 OF SUCH A SYSTEM WHERE, IN THE  SECRETARY'S  DISCRETION,  THE  SECRETARY
 BELIEVES  THE  SYSTEM  HAS  A  HIGH LIKELIHOOD OF VIOLATING SECTION FOUR
 HUNDRED TWENTY-NINE OR SECTION FOUR HUNDRED THIRTY OF THIS ARTICLE.
   3. THE DUTIES SET FORTH IN THIS SECTION SHALL APPLY ONLY  TO  ADVANCED
 ARTIFICIAL INTELLIGENCE SYSTEMS THAT MORE LIKELY THAN NOT FALL UNDER THE
 DEFINITION  OF  HIGH-RISK  ADVANCED  ARTIFICIAL  INTELLIGENCE  SYSTEM AS
 DEFINED IN SECTION FOUR HUNDRED ONE OF  THIS  ARTICLE.    THE  SECRETARY
 SHALL  SEND  NOTICE TO ANY SYSTEM THAT IS PRESENTLY PERFORMING FUNCTIONS
 FOR ITS INTENDED PURPOSE OR WITHIN ITS DESIGNATED OPERATIONAL PARAMETERS
 A. 8195                            10
 
 WHICH, IN HIS OR HER DISCRETION, MAY FALL UNDER THE DEFINITION OF  HIGH-
 RISK  ADVANCED  ARTIFICIAL  INTELLIGENCE SYSTEMS BUT THAT HAS NOT REGIS-
 TERED WITH THE SECRETARY. IN THE NOTICE, THE SECRETARY MAY  REQUIRE  THE
 CREATORS  OF THE SYSTEM TO CEASE DEVELOPMENT AND ACCESS BY PRIVATE INDI-
 VIDUALS OR THE GENERAL PUBLIC, PENDING  REVIEW.  SUCH  NOTICE  SHALL  BE
 BINDING  AND  HAVE THE EFFECT OF LAW.  DETERMINATIONS THAT A SYSTEM IS A
 HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM SHALL  BE  MADE  IN  A
 HEARING  HELD PURSUANT TO THE PROVISIONS OF SECTION FOUR HUNDRED NINE OF
 THIS ARTICLE.  IN SUCH HEARING, THE ADMINISTRATOR OF SUCH HEARING  SHALL
 ACCEPT COMMENTS FROM THE PUBLIC. SUCH HEARING SHALL, TO THE EXTENT PRAC-
 TICABLE,   NOT  DISCLOSE  ANY  PROPRIETARY  INFORMATION  CONCERNING  THE
 ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM TO THE PUBLIC.
   4. A DETERMINATION PURSUANT TO A HEARING HELD PURSUANT TO SECTION FOUR
 HUNDRED NINE OF THIS ARTICLE SHALL BE BINDING AND FINAL, PROVIDED HOWEV-
 ER THAT THE SECRETARY MAY, IN HIS OR  HER  DISCRETION,  CONDUCT  FURTHER
 REVIEW  AFTER A DETERMINATION HAS BEEN MADE AND MAY APPEAL SUCH DETERMI-
 NATION WHERE APPROPRIATE BASED ON  INFORMATION  NOT  AVAILABLE  IN  SUCH
 HEARING.
   5. WHERE A HEARING CONCLUDES THAT A NON-REGISTERED ADVANCED ARTIFICIAL
 SYSTEM IS A HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM, THE CREA-
 TORS  OF SUCH A SYSTEM SHALL CEASE DEVELOPMENT AND PUBLIC OR PRIVATE USE
 UNTIL REGISTRATION IS COMPLETED.  THE SECRETARY MAY  IMPOSE  A  MONETARY
 PENALTY  FOR  SUCH FAILURE AND CHARGE ALL COSTS OF THE PROCEEDING TO THE
 OPERATOR WHERE THE SECRETARY DETERMINES THAT THE CREATORS OF THE  SYSTEM
 KNEW  THAT  THE  SYSTEM WOULD MORE LIKELY THAN NOT BE CONSIDERED A HIGH-
 RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM  AND  WILLFULLY  FAILED  TO
 REGISTER,  THE  SECRETARY MAY, IN HIS OR HER DISCRETION, IMPOSE PUNITIVE
 FINES AND OTHER PENALTIES PURSUANT TO THE  PROVISIONS  OF  THIS  ARTICLE
 BASED ON THE LEVEL OF RISK THAT THE HIGH-RISK ADVANCED ARTIFICIAL INTEL-
 LIGENCE SYSTEM POSSESSES, THE WIDESPREAD USE OF THE SYSTEM, THE SEVERITY
 OF  THE DAMAGE THAT THE SYSTEM CAUSED, IF ANY, AND WHETHER THE SYSTEM IS
 UNCONTAINED.  THE SECRETARY MAY ALSO PROHIBIT SUCH PERSONS  INVOLVED  IN
 THE  DEVELOPMENT  OF  SUCH  A  SYSTEM FROM OBTAINING A LICENSE FOR THEIR
 EXISTING SYSTEM OR SYSTEMS OR IN THE FUTURE.
   § 411. LICENSE. 1. NO PERSON SHALL (A) DEVELOP, IN WHOLE OR IN PART, A
 HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM AS  DEFINED  IN  PARA-
 GRAPH (I) OF SUBDIVISION TWO OF SECTION FOUR HUNDRED ONE OF THIS ARTICLE
 OR  OPERATE SUCH A SYSTEM THAT IS PRESENTLY PERFORMING FUNCTIONS FOR ITS
 INTENDED PURPOSE OR WITHIN ITS DESIGNATED  OPERATION  PARAMETERS  WITHIN
 THE  STATE  WHERE SUCH SYSTEM WAS DEVELOPED OUTSIDE OF THE STATE; OR (B)
 OPERATE A HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM OTHER THAN A
 SYSTEM AS DEFINED IN PARAGRAPH (I) OF SUBDIVISION TWO  OF  SECTION  FOUR
 HUNDRED  ONE  OF THIS ARTICLE THAT IS PRESENTLY PERFORMING FUNCTIONS FOR
 ITS INTENDED PURPOSE OR WITHIN  ITS  DESIGNATED  OPERATIONAL  PARAMETERS
 WITHIN THE STATE WITHOUT FIRST OBTAINING A LICENSE.
   2.  AN  APPLICATION FOR A LICENSE UNDER THIS ARTICLE SHALL BE IN WRIT-
 ING, UNDER OATH AND IN THE FORM PRESCRIBED BY THE SECRETARY.
   3. AT THE TIME OF FILING AN APPLICATION FOR A LICENSE,  THE  APPLICANT
 SHALL  PAY  TO  THE  SECRETARY  AN APPLICATION FEE. SUCH APPLICATION FEE
 SHALL BE PRESCRIBED PURSUANT TO THE RULES AND REGULATIONS OF THE  SECRE-
 TARY.
   4.  A  LICENSE  GRANTED PURSUANT TO THIS ARTICLE SHALL BE VALID UNLESS
 REVOKED OR SUSPENDED BY THE SECRETARY OR SURRENDERED BY THE LICENSEE.
   § 412. SUPPLEMENTAL LICENSE. 1. WHERE A PERSON OTHER  THAN  A  NATURAL
 PERSON  IS  LICENSED  UNDER  THIS ARTICLE, SUCH PERSON SHALL APPLY FOR A
 SUPPLEMENTAL LICENSE FOR EACH ADDITIONAL HIGH-RISK  ADVANCED  ARTIFICIAL
 A. 8195                            11
 
 INTELLIGENCE  SYSTEM SUCH PERSON DEVELOPS AFTER BEING LICENSED INITIALLY
 PURSUANT TO SECTION FOUR HUNDRED ELEVEN OF THIS ARTICLE.
   2.  NOTWITHSTANDING  ANY  PROVISION  OF LAW, RULE OR REGULATION TO THE
 CONTRARY, A SUPPLEMENTAL LICENSE SHALL BE PROVIDED IN THE SAME MANNER AS
 A LICENSE GRANTED PURSUANT TO THE PROVISIONS  OF  SECTION  FOUR  HUNDRED
 ELEVEN  OF  THIS  ARTICLE AND SHALL BE SUBJECT TO THE SAME REQUIREMENTS,
 DUTIES AND PROHIBITIONS AS PROVIDED FOR IN THIS ARTICLE.
   § 413. APPLICATION FOR LICENSES.  1.  AN  APPLICATION  FOR  A  LICENSE
 REQUIRED  UNDER THIS ARTICLE SHALL BE IN WRITING, UNDER OATH, AND IN THE
 FORM PRESCRIBED BY THE SECRETARY, AND SHALL CONTAIN THE FOLLOWING:
   (A) THE EXACT NAME AND ADDRESS OF THE APPLICANT, AND IF THE  APPLICANT
 BE  A  CO-PARTNERSHIP  OR ASSOCIATION, THE NAMES OF THE MEMBERS THEREOF,
 AND IF A CORPORATION THE DATE AND PLACE OF ITS INCORPORATION;
   (B) THE NAME AND THE BUSINESS AND RESIDENTIAL ADDRESS OF  EACH  MEMBER
 OF  THE ETHICS AND RISK MANAGEMENT BOARD, EACH PRINCIPAL, AND OFFICER OF
 THE APPLICANT; AND
   (C) THE DESCRIPTION OF ALL KNOWN GENERAL USE  CASES  OF  THE  ADVANCED
 ARTIFICIAL  INTELLIGENCE  SYSTEM,  INCLUDING ANY PURPOSES FORESEEN TO BE
 IMPLEMENTED BY THE APPLICANT. A "USE CASE" SHALL  BE  DEFINED  AS  BROAD
 CATEGORY OF POTENTIAL USE.
   2.  AFTER  THE  FILING  OF AN APPLICATION FOR A LICENSE ACCOMPANIED BY
 PAYMENT OF THE FEES FOR LICENSE AND INVESTIGATION, IT SHALL BE  SUBSTAN-
 TIVELY  REVIEWED.    AFTER  THE  APPLICATION  IS  DEEMED  SUFFICIENT AND
 COMPLETE, THE SECRETARY SHALL ISSUE THE LICENSE, OR  THE  SECRETARY  MAY
 REFUSE TO ISSUE THE LICENSE IF THE SECRETARY SHALL FIND THAT THE ETHICS,
 EXPERIENCE, CHARACTER AND GENERAL FITNESS OF THE APPLICANT OR ANY PERSON
 ASSOCIATED  WITH THE APPLICANT ARE NOT SUCH AS TO COMMAND THE CONFIDENCE
 OF THE COMMUNITY AND TO WARRANT THE BELIEF THAT  THE  BUSINESS  WILL  BE
 CONDUCTED  HONESTLY,  FAIRLY  AND  EFFICIENTLY  WITHIN  THE PURPOSES AND
 INTENT OF THIS ARTICLE.
   3. IF THE SECRETARY REFUSES TO ISSUE A LICENSE,  THE  SECRETARY  SHALL
 NOTIFY THE APPLICANT OF THE DENIAL, RETURN TO THE APPLICANT THE SUM PAID
 AS A LICENSE FEE, BUT RETAIN THE INVESTIGATION FEE TO COVER THE COSTS OF
 INVESTIGATING THE APPLICANT.
   4.  EACH  LICENSE ISSUED PURSUANT TO THIS ARTICLE SHALL REMAIN IN FULL
 FORCE UNLESS IT IS SURRENDERED BY THE LICENSEE, REVOKED OR SUSPENDED.
   § 414. LICENSE PROVISIONS AND POSTING. 1.  ANY  LICENSE  ISSUED  UNDER
 THIS  ARTICLE  SHALL  STATE THE NAME AND ADDRESS OF THE LICENSEE, AND IF
 THE LICENSEE BE A  CO-PARTNERSHIP  OR  ASSOCIATION,  THE  NAMES  OF  THE
 MEMBERS THEREOF, AND IF A CORPORATION THE DATE AND PLACE OF ITS INCORPO-
 RATION.
   2.  SUCH LICENSE OR LICENSES SHALL BE KEPT CONSPICUOUSLY POSTED IN THE
 OFFICE OF THE LICENSEE AND, WHERE SUCH LICENSEE HAS  A  PUBLIC  INTERNET
 PRESENCE, ON THE WEBSITE OR MOBILE APPLICATION OF THE LICENSEE AND SHALL
 NOT BE TRANSFERABLE OR ASSIGNABLE.
   §  415. GROUNDS FOR SUSPENSION OR REVOCATION OF LICENSE; PROCEDURE. 1.
 A LICENSE GRANTED PURSUANT TO THIS SECTION MAY NOT BE RENEWED,  AND  MAY
 BE REVOKED OR SUSPENDED BY THE SECRETARY UPON A FINDING THAT:
   (A) THE LICENSEE HAS NOT COMPLIED WITH REPORTING REQUIREMENTS;
   (B) THE LICENSEE HAS VIOLATED ANY PROVISION OF THIS ARTICLE;
   (C)  THE LICENSEE KNOWINGLY ALLOWED A NON-CERTIFIED THIRD-PARTY SYSTEM
 TO INTEGRATE WITH THE LICENSEE'S SYSTEM;
   (D) ANY FACT OR CONDITION EXISTS WHICH, IF IT HAD EXISTED AT THE  TIME
 OF  THE  ORIGINAL  APPLICATION  FOR  SUCH  LICENSE,  CLEARLY  WOULD HAVE
 WARRANTED THE SECRETARY'S REFUSAL TO ISSUE SUCH LICENSE; OR
 A. 8195                            12

   (E) THE LICENSEE HAS FAILED TO PAY ANY SUM OF MONEY LAWFULLY  DEMANDED
 BY  THE SECRETARY OR TO COMPLY WITH ANY DEMAND, RULING OR REQUIREMENT OF
 THE SECRETARY.
   2.  ANY LICENSEE MAY SURRENDER ANY LICENSE BY DELIVERING TO THE SECRE-
 TARY WRITTEN NOTICE THAT THE LICENSEE THEREBY SURRENDERS  SUCH  LICENSE,
 BUT  SUCH  SURRENDER  SHALL NOT AFFECT SUCH LICENSEE'S CIVIL OR CRIMINAL
 LIABILITY FOR ACTS COMMITTED PRIOR TO SUCH SURRENDER.
   3. EVERY LICENSE ISSUED HEREUNDER SHALL REMAIN  IN  FORCE  AND  EFFECT
 UNTIL  THE  SAME  SHALL  HAVE  BEEN SURRENDERED, REVOKED OR SUSPENDED IN
 ACCORDANCE WITH THE PROVISIONS OF THIS ARTICLE, BUT THE SECRETARY  SHALL
 HAVE  AUTHORITY TO REINSTATE SUSPENDED LICENSES OR TO ISSUE NEW LICENSES
 TO A LICENSEE WHOSE LICENSE OR LICENSES SHALL HAVE BEEN  REVOKED  IF  NO
 FACT  OR  CONDITION  THEN  EXISTS WHICH CLEARLY WOULD HAVE WARRANTED THE
 SECRETARY'S REFUSAL TO ISSUE SUCH LICENSE.
   4. WHENEVER THE SECRETARY SHALL REVOKE OR  SUSPEND  A  LICENSE  ISSUED
 PURSUANT  TO THIS ARTICLE, THE SECRETARY SHALL FORTHWITH EXECUTE A WRIT-
 TEN ORDER TO THAT EFFECT.
   5. THE SECRETARY MAY, ON  GOOD  CAUSE  SHOWN,  OR  WHERE  THERE  IS  A
 SUBSTANTIAL RISK OF PUBLIC HARM OR SUBSTANTIAL RISK OF A SYSTEM BECOMING
 UNCONTAINED,  WITHOUT  NOTICE  AND A HEARING, SUSPEND ANY LICENSE ISSUED
 PURSUANT TO THIS ARTICLE FOR A PERIOD NOT EXCEEDING THIRTY DAYS, PENDING
 INVESTIGATION.
   § 416. ETHICS AND RISK MANAGEMENT BOARD AND REPORTS. 1. EVERY OPERATOR
 OF A LICENSED  HIGH-RISK  ADVANCED  ARTIFICIAL  INTELLIGENCE  SYSTEM  OR
 SYSTEMS  SHALL ESTABLISH AN ETHICS AND RISK MANAGEMENT BOARD COMPOSED OF
 NO LESS THAN FIVE INDIVIDUALS  WHO  SHALL  HAVE  THE  RESPONSIBILITY  TO
 ASSESS THE ETHICAL IMPLICATIONS OF ALL POSSIBLE USE CASES OF THE SYSTEM,
 WHETHER SUCH USE CASES ARE INTENDED OR UNINTENDED, AND WHETHER LIKELY OR
 UNLIKELY TO BE USED, AND THE CURRENT OPERATIONAL OUTCOMES OF THE SYSTEM.
 SUCH OPERATOR, OTHER THAN AN OPERATOR WHO IS A NATURAL PERSON, OPERATING
 MORE  THAN  ONE HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM WITH A
 SUPPLEMENTAL LICENSE SHALL NOT BE REQUIRED TO HAVE MORE THAN ONE  ETHICS
 AND RISK MANAGEMENT BOARD FOR EACH SYSTEM.
   2. NO MEMBER OF AN ETHICS AND RISK MANAGEMENT BOARD SHALL BE A MEMBER,
 OFFICER,  OR  DIRECTOR  WITHIN THE OPERATOR'S ENTITY. NO MEMBER SHALL BE
 REQUIRED TO BE EMPLOYED BY THE OPERATOR.
   3. SUCH BOARD SHALL ADOPT RULES GOVERNING  ITS  DECISION-MAKING  PROC-
 ESSES,  DUTIES  AND RESPONSIBILITIES. SUCH RULES SHALL NOT CONFLICT WITH
 THE PROVISIONS OF THIS ARTICLE.
   4. ANNUALLY, THE ETHICS AND RISK MANAGEMENT  BOARD  OF  EACH  OPERATOR
 SHALL  SUBMIT  TO THE SECRETARY A COMPREHENSIVE REPORT FOR EACH LICENSED
 HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM WHICH CONSISTS OF  THE
 FOLLOWING:
   (A)  ALL  POSSIBLE  USE CASES, WHETHER INTENDED OR UNINTENDED, WHETHER
 LIKELY OR UNLIKELY.
   (B) A THOROUGH RISK ASSESSMENT FOR  EACH  USE  CASE,  CONSIDERING  AND
 EVALUATING  THE  POTENTIAL  FOR HARM, IRRESPECTIVE OF THE PROBABILITY OF
 SUCH RISK MATERIALIZING. THIS SHALL INCLUDE, BUT NOT BE LIMITED TO,  THE
 SYSTEM'S  POTENTIAL  IMPACT  ON  PRIVACY,  SECURITY,  FAIRNESS, ECONOMIC
 IMPLICATIONS, SOCIETAL WELL-BEING, AND SAFETY OF PERSONS AND  THE  ENVI-
 RONMENT.
   (C)  A  DETAILED EVALUATION OF KNOWN USE CASES OF THE SYSTEM BY USERS,
 EXPLORING WHETHER CERTAIN APPLICATIONS OUGHT TO BE CONSTRAINED OR BANNED
 DUE TO ETHICAL CONSIDERATIONS. THIS SHALL INCLUDE AN ASSESSMENT  OF  THE
 OPERATOR'S CAPACITY TO IMPOSE SUCH CONSTRAINTS ON USE CASES.
 A. 8195                            13
 
   (D)  A  MITIGATION PLAN FOR EACH IDENTIFIED RISK, INCLUDING PREEMPTIVE
 MEASURES, MONITORING PROCESSES, AND RESPONSIVE ACTIONS. THIS SHALL  ALSO
 INCLUDE  A COMMUNICATION STRATEGY TO INFORM USERS AND STAKEHOLDERS ABOUT
 POTENTIAL RISKS AND STEPS TAKEN TO MITIGATE THEM.
   (E)  A COMPREHENSIVE REVIEW OF ANY INCIDENTS OR FAILURES OF THE SYSTEM
 IN THE PAST YEAR, DETAILING THE CIRCUMSTANCES, IMPACTS,  MEASURES  TAKEN
 TO  ADDRESS  THE ISSUE, AND MODIFICATIONS MADE TO PREVENT SUCH INCIDENTS
 IN THE FUTURE.
   (F) ANY EXISTING ATTEMPTS TO EDUCATE USERS AND, BASED ON THE  EXISTING
 USE  OF THE SYSTEM BY USERS, A DETAILED PLAN ON HOW THE OPERATOR INTENDS
 TO INFORM AND INSTRUCT USERS ON THE SAFE AND ETHICAL USE OF THE  SYSTEM,
 CONSIDERING VARYING LEVELS OF DIGITAL LITERACY AMONG USERS.
   (G) A DISCLOSURE OF ANY CONFLICTS OF INTEREST WITHIN THE ETHICS BOARD,
 WHICH  COULD POTENTIALLY INFLUENCE THE BOARD'S DECISIONS AND RECOMMENDA-
 TIONS. THIS SHALL INCLUDE MEASURES TO MANAGE AND RESOLVE SUCH CONFLICTS.
   (H) AN UPDATE ON THE MEASURES TAKEN BY  THE  OPERATOR  TO  ENSURE  THE
 SYSTEM'S ADHERENCE TO EXISTING LAWS, REGULATIONS, AND ETHICAL GUIDELINES
 RELATED TO ARTIFICIAL INTELLIGENCE.
   5.   IN ADDITION TO ANY APPLICABLE CIVIL PENALTIES PURSUANT TO SECTION
 FOUR HUNDRED EIGHT OF THIS ARTICLE, A  MEMBER  OF  AN  ETHICS  AND  RISK
 MANAGEMENT  BOARD  WHO  MAKES  A  FALSE  STATEMENT,  FAILS  TO  DISCLOSE
 CONFLICTS OF INTEREST OR MISREPRESENTS THE  RISKS  OR  SEVERITY  OF  THE
 RISKS  POSED  BY  A  SYSTEM IN THE PERFORMANCE OF HIS OR HER DUTIES AS A
 MEMBER OF SUCH BOARD,  SHALL  BE  GUILTY  OF  A  MISDEMEANOR  AND,  UPON
 CONVICTION,  SHALL BE FINED NOT MORE THAN FIVE HUNDRED DOLLARS OR IMPRI-
 SONED FOR NOT MORE THAN SIX MONTHS OR BOTH, IN  THE  DISCRETION  OF  THE
 COURT.
   §  417. SOURCE CODE AND OUTCOME REVIEW. 1. THE SECRETARY SHALL CONDUCT
 PERIODIC EVALUATIONS OF THE SOURCE CODE  AND  OUTCOMES  ASSOCIATED  WITH
 EACH  HIGH-RISK  ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM. THESE EXAMINA-
 TIONS SHALL DETERMINE WHETHER THE SYSTEM  IS  IN  COMPLIANCE  WITH  THIS
 ARTICLE.  THE  TIMING AND FREQUENCY OF THESE REVIEWS SHALL BE DETERMINED
 AT THE SECRETARY'S DISCRETION, TAKING INTO ACCOUNT  THE  POTENTIAL  RISK
 POSED  BY  THE  SYSTEM,  THE  COMPLEXITY OF THE SYSTEM, THE FREQUENCY OF
 UPDATES AND UPGRADES, THE COMPLEXITY OF SUCH UPDATES AND  UPGRADES,  AND
 ANY PREVIOUS ISSUES OF NON-COMPLIANCE.
   2.  UPON  COMPLETION OF THE REVIEW, THE SECRETARY IS EMPOWERED TO MAKE
 BINDING RECOMMENDATIONS TO THE OPERATOR TO ENSURE THE SYSTEM'S FUNCTION-
 ALITY AND OUTCOMES ARE ALIGNED WITH THE PRINCIPLES IN THE ADVANCED ARTI-
 FICIAL INTELLIGENCE ETHICAL CODE OF CONDUCT  PURSUANT  TO  SECTION  FOUR
 HUNDRED  TWENTY-NINE OF THIS ARTICLE, RESTRICTIONS ON PROHIBITED ARTIFI-
 CIAL INTELLIGENCE SYSTEMS PURSUANT TO SECTION  FOUR  HUNDRED  THIRTY  OF
 THIS  ARTICLE,  AND LIMITATIONS AND PROCEDURES FOR SOURCE CODE MODIFICA-
 TIONS, UPDATES, UPGRADES, AND REWRITES PURSUANT TO SECTION FOUR  HUNDRED
 NINETEEN OF THIS ARTICLE.
   3.  FOLLOWING RECEIPT OF THE SECRETARY'S RECOMMENDATIONS, THE OPERATOR
 SHALL CONSULT WITH THE SECRETARY TO DETERMINE THE FEASIBILITY OF  IMPLE-
 MENTING THE RECOMMENDATIONS AND THE TIME FRAME IN WHICH SUCH RECOMMENDA-
 TIONS  CAN BE IMPLEMENTED TO ENSURE FULL COMPLIANCE WITH THE SECRETARY'S
 RECOMMENDATIONS. THE OPERATOR SHALL PROVIDE A  DETAILED  PLAN  OUTLINING
 HOW  THE  RECOMMENDATIONS  WILL  BE ADDRESSED, ALONG WITH A TIMELINE FOR
 THEIR IMPLEMENTATION. THE DETAILED PLAN SHALL BE BINDING ON  THE  OPERA-
 TOR;  PROVIDED  HOWEVER THAT WHERE AN UNEXPECTED OCCURRENCE ARISES WHICH
 CAUSES CHANGES TO SUCH PLAN, THE OPERATOR SHALL BE  ENTITLED  TO  EXTEND
 SUCH  TIMELINE  OR  ALTER  SUCH  PLANS  WHERE SUCH OPERATOR NOTIFIES THE
 SECRETARY IN WRITING REGARDING THE  UNEXPECTED  OCCURRENCE  AND,  WITHIN
 A. 8195                            14
 
 SUCH  WRITING,  SETS FORTH AMENDMENTS TO THE DETAILED PLAN AND TIMELINE.
 THE SECRETARY SHALL HAVE THIRTY DAYS TO APPROVE OR  REJECT  SUCH  AMEND-
 MENTS.   WHERE SUCH AMENDMENTS ARE REJECTED, THE OPERATOR SHALL CONTINUE
 WITH THEIR ORIGINAL PLAN AND TIMELINE.
   4.  THE  SECRETARY  SHALL  MONITOR THE OPERATOR'S COMPLIANCE WITH SUCH
 RECOMMENDATIONS AND MAY IMPOSE FINES AND OTHER PENALTIES PURSUANT TO THE
 PROVISIONS OF THIS ARTICLE FOR NON-COMPLIANCE THAT THE  SECRETARY  SHALL
 DEEM JUST AND PROPORTIONATE TO THE VIOLATION.
   § 418. WILLFULLY OR NEGLIGENTLY UNCONTAINING HIGH-RISK SOURCE CODE. 1.
 NO LICENSEE OR NON-LICENSEE WHO DEVELOPS A HIGH-RISK ADVANCED ARTIFICIAL
 INTELLIGENCE  SYSTEM  SHALL  WILLFULLY  OR  NEGLIGENTLY  UNCONTAIN THEIR
 SOURCE CODE EXCEPT WHERE AUTHORIZED BY THE SECRETARY IN WRITING.
   2. ANY MEMBER, OFFICER, DIRECTOR OR EMPLOYEE OF AN ENTITY WHO WILLFUL-
 LY VIOLATES SUBDIVISION ONE OF THIS SECTION SHALL BE GUILTY OF A CLASS E
 FELONY.
   3. ANY MEMBER, OFFICER, DIRECTOR OR EMPLOYEE OF AN ENTITY  WHO  NEGLI-
 GENTLY  VIOLATES  SUBDIVISION  ONE  OF THIS SECTION SHALL BE GUILTY OF A
 CLASS A MISDEMEANOR.
   4. WHERE ANY MEMBER, OFFICER, DIRECTOR OR EMPLOYEE OR AN ENTITY  WILL-
 FULLY OR NEGLIGENTLY UNCONTAINS A HIGH-RISK ADVANCED ARTIFICIAL INTELLI-
 GENCE  SYSTEM  DESCRIBED  IN PARAGRAPH (F) OF SUBDIVISION TWO OF SECTION
 FOUR HUNDRED ONE OF THIS ARTICLE  OR  A  PROHIBITED  HIGH-RISK  ADVANCED
 ARTIFICIAL  INTELLIGENCE  SYSTEM  AS  DESCRIBED  IN SECTION FOUR HUNDRED
 THIRTY OF THIS ARTICLE SHALL BE GUILTY OF A CLASS C FELONY.
   5. THE PROVISIONS OF THIS SECTION SHALL NOT BE CONSTRUED  AS  IMPOSING
 LIABILITY  ON  ANY  MEMBER,  OFFICER,  DIRECTOR  OR  EMPLOYEE WHO HAD NO
 EXPLICIT OR IMPLICIT KNOWLEDGE OF THE RISK OR CIRCUMSTANCES THAT  CAUSED
 THE  UNCONTAINMENT  OF  THE  HIGH-RISK  ADVANCED ARTIFICIAL INTELLIGENCE
 SYSTEM.
   § 419. SOURCE CODE MODIFICATIONS, UPDATES, UPGRADES, AND REWRITES.  1.
 WHERE  A LICENSEE INTENDS TO MODIFY OR UPGRADE THE SOURCE CODE OF HIS OR
 HER HIGH-RISK ADVANCED ARTIFICIAL  INTELLIGENCE  SYSTEM,  SUCH  LICENSEE
 SHALL  BE  REQUIRED  TO  INFORM  THE  SECRETARY  OF SUCH MODIFICATION OR
 UPGRADE AND SHALL BE PROHIBITED FROM IMPLEMENTING SUCH  MODIFICATION  OR
 UPGRADE  IN  AN ACCESSIBLE VERSION OF THE SYSTEM WITHOUT EXPRESS CONSENT
 OF THE SECRETARY IN WRITING. THIS SECTION SHALL NOT APPLY TO SOURCE CODE
 UPDATES.
   2. A LICENSEE SHALL, IN  WRITING  TO  THE  SECRETARY,  SET  FORTH  THE
 PURPOSE  OF  THE MODIFICATION OR UPGRADE, THE NEW FUNCTIONS ADDED TO THE
 SYSTEM OR THE FUNCTIONS MODIFIED, THE REASON  FOR  THE  MODIFICATION  OR
 UPGRADE, AND AN ASSESSMENT OF NEW RISKS OR RISKS THAT MAY BE MORE PROBA-
 BLE  AS  A  RESULT  OF THE MODIFICATION OR UPGRADE. THE SECRETARY SHALL,
 UPON RECEIPT OF NOTICE, HAVE THIRTY BUSINESS DAYS TO PROVIDE THE  LICEN-
 SEE  WITH APPROVAL OF THE MODIFICATION OR UPGRADE. WHERE APPROVAL IS NOT
 RECEIVED WITHIN THIRTY BUSINESS DAYS, ABSENT  AN  EXTENSION  IN  WRITING
 WHICH SHALL NOT EXCEED THIRTY ADDITIONAL BUSINESS DAYS, THE MODIFICATION
 OR  UPGRADE  SHALL BE DEEMED APPROVED. NOTHING IN THIS SUBDIVISION SHALL
 BE CONSTRUED AS LIMITING THE ABILITY OF THE SECRETARY TO TAKE ANY ACTION
 HE OR SHE IS AUTHORIZED TO TAKE IN RELATION TO THE APPROVED MODIFICATION
 OR UPGRADE. WHERE THE SECRETARY REJECTS THE MODIFICATION OR UPGRADE, THE
 SECRETARY SHALL SET FORTH IN WRITING THE REASONS FOR THE  REJECTION  AND
 STEPS  THAT  THE LICENSEE CAN TAKE TO RECEIVE APPROVAL. WHERE THE SECRE-
 TARY APPROVES THE MODIFICATION OR UPGRADE, THE LICENSEE MAY  IMMEDIATELY
 IMPLEMENT SUCH MODIFICATION OR UPGRADE IN A PUBLICLY ACCESSIBLE VERSION.
   3.  A LICENSEE WHO REWRITES THE SOURCE CODE OF ITS SYSTEM SHALL COMPLY
 WITH THE SAME STANDARDS SET FORTH IN SUBDIVISIONS ONE AND  TWO  OF  THIS
 A. 8195                            15
 
 SECTION  PROVIDED  HOWEVER  THAT THE SECRETARY SHALL EXAMINE SUCH SOURCE
 CODE IN THE SAME MANNER AS A NEW APPLICATION AND SHALL PROVIDE A  LETTER
 OF  APPROVAL  OR  REJECTION  UPON  COMPLETION  OF SUCH REVIEW WITHIN ONE
 HUNDRED EIGHTY BUSINESS DAYS OF RECEIPT OF SUCH NOTICES EXCEPT WHERE THE
 SECRETARY  REQUIRES  AN  EXTENSION OF TIME, THEN AN EXTENSION OF NO MORE
 THAN ONE HUNDRED EIGHTY DAYS SHALL BE AUTHORIZED.  WHERE  THE  SECRETARY
 REJECTS  THE  REWRITE,  SUCH LETTER OF REJECTION SHALL STATE THE REASONS
 FOR THE REJECTION AND STEPS THAT THE LICENSEE CAN TAKE TO  CORRECT  SUCH
 REJECTION,  IF  ANY.    WHERE THE SECRETARY APPROVES THE MODIFICATION OR
 UPGRADE, THE LICENSEE MAY IMMEDIATELY  IMPLEMENT  SUCH  MODIFICATION  OR
 UPGRADE IN A PUBLICLY ACCESSIBLE VERSION.
   4.  ALL  MODIFICATIONS, UPGRADES, AND REWRITES SHALL BE CONDUCTED IN A
 PRE-PRODUCTION ENVIRONMENT, WHICH SHALL MEAN  ANY  STAGE  PRIOR  TO  THE
 ACCESSIBLE VERSION.
   5. FOR PURPOSES OF THIS SECTION:
   (A)  "MODIFY"  SHALL  MEAN  ALTERING  THE SOURCE CODE OF THE SYSTEM TO
 ALTER THE WAY BY WHICH THE SYSTEM, OR ANY FEATURES  WITHIN  THE  SYSTEM,
 MAKES DECISIONS.
   (B)  "UPGRADE" SHALL MEAN ALTERING THE SOURCE CODE OF THE SYSTEM WHICH
 GIVES IT NEW FEATURES OR FUNCTIONS.
   (C) "REWRITE" SHALL MEAN A  CHANGE  IN  THE  SOURCE  CODE  TO  SUCH  A
 SUBSTANTIAL DEGREE THAT:
   (I) IT EFFECTIVELY RESULTS IN A NEW VERSION OF THE SYSTEM; OR
   (II)  THE  CHANGE NULLIFIES ALL OR A SUBSTANTIAL AMOUNT OF THE INITIAL
 FINDINGS OF THE SECRETARY IN THE OPERATOR'S ORIGINAL APPLICATION.
   (D) "UPDATE" SHALL MEAN A CHANGE TO  THE  SOURCE  CODE  THAT  INCLUDES
 MINOR  ENHANCEMENTS,  IMPROVEMENTS,  MODIFICATIONS,  ERROR  CORRECTIONS,
 COSMETIC CHANGES, OR ANY OTHER CHANGE INTENDED TO INCREASE THE FUNCTION-
 ALITY, COMPATIBILITY, SECURITY OR PERFORMANCE OF THE SYSTEM.
   (E) "ACCESSIBLE VERSION" SHALL MEAN A VERSION OF THE SOFTWARE THAT  IS
 AVAILABLE  TO THE PUBLIC OR FOR PRIVATE USE OR THAT IS PRESENTLY OPERAT-
 ING WITHIN ITS DESIGNATED OPERATIONAL PARAMETERS.
   § 420. MALFUNCTION AND INCIDENT REPORTS; DUTY TO NOTIFY. 1. A LICENSEE
 SHALL HAVE THE DUTY TO NOTIFY THE DEPARTMENT AND, IF APPLICABLE, A RELE-
 VANT LAW ENFORCEMENT AGENCY OR GOVERNMENTAL ENTITY WHERE THE  LICENSEE'S
 SYSTEM  FAILS TO OPERATE AS INTENDED FOR ANY SIGNIFICANT PERIOD OF TIME.
 A PERIOD OF TIME IS DEEMED "SIGNIFICANT" FOR PURPOSES  OF  THIS  SECTION
 WHERE  THE PERIOD OF TIME THAT THE MALFUNCTION OCCURRED HAD THE CAPACITY
 TO OR HAS HARMED A PERSON OR PERSONS.
   2. A LICENSEE SHALL HAVE THE DUTY TO NOTIFY A RELEVANT LAW ENFORCEMENT
 AGENCY OR GOVERNMENTAL ENTITY OF A MALFUNCTION WHERE DESIGNATED  BY  THE
 DEPARTMENT  UPON  RECEIPT OF A LICENSE. THE SECRETARY SHALL ISSUE SUCH A
 REQUIREMENT UPON THE LICENSEE  WHERE  SUCH  SYSTEMS  INTERACT  WITH  LAW
 ENFORCEMENT SYSTEMS OR THE SYSTEMS OF A GOVERNMENT AGENCY, ENGAGE IN LAW
 ENFORCEMENT  FUNCTIONS OR THE FUNCTIONS OF A GOVERNMENT AGENCY, OR WHERE
 SUCH SYSTEMS OPERATE, IN WHOLE OR IN PART, OR ARE, A WEAPON.
   § 421. STATE AND NATIONAL SECURITY RISKS. 1.  THE  SECRETARY  MAY,  BY
 REGULATION,  DESIGNATE  UNIQUE  REQUIREMENTS  FOR  SYSTEMS WHICH, IN THE
 SECRETARY'S DISCRETION, POSE A RISK TO STATE OR NATIONAL SECURITY.  SUCH
 SYSTEMS  SHALL  BE  ASSESSED  ON  A  CASE-BY-CASE BASIS AND SHALL NOT BE
 LIBERALLY CONSTRUED AS INCLUDING ANY SYSTEM THAT, WHERE USED IMPROPERLY,
 INHERENTLY POSSESSES THE ABILITY TO HARM PERSONS OR PROPERTY.
   2. A HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM SHALL BE DEEMED
 TO POSE A RISK TO STATE OR NATIONAL SECURITY WHERE THE SYSTEM'S MALFUNC-
 TIONING OR MISUSE POSES A HIGH RISK OF:
   (A) DISRUPTING CRITICAL INFRASTRUCTURE;
 A. 8195                            16
 
   (B) TRIGGERING OR ESCALATING EXISTING CONFLICTS;
   (C) UNDERMINING OR IMPACTING THE DEMOCRATIC PROCESS;
   (D)  CAUSING  UNAUTHORIZED  ACCESS TO CLASSIFIED INFORMATION AS DESIG-
 NATED BY A RELEVANT GOVERNMENTAL ENTITY;
   (E) HARMING A SIGNIFICANT PORTION OF  THE  POPULATION  OR  A  SPECIFIC
 SEGMENT OF THE POPULATION;
   (F) NEGATIVELY IMPACTING FINANCIAL MARKETS OR ECONOMIC STABILITY;
   (G)  CAUSING  CONSEQUENTIAL OR IRREVERSIBLE DAMAGE TO THE ENVIRONMENT;
 OR
   (H) CAUSING SIGNIFICANT HARM TO THE SOCIAL FABRIC.
   § 422. INFORMATION AND SOURCE CODE  SHARING.  1.  LICENSEES  SHALL  BE
 PERMITTED  TO  SHARE  INFORMATION  AND SOURCE CODE WITH ANY THIRD PARTY,
 PROVIDED HOWEVER, THAT WHERE INFORMATION IS BIOMETRIC  INFORMATION  SUCH
 PARTY  SHALL  BE  JOINTLY  LIABLE  FOR ANY HARM OR VIOLATIONS UNDER THIS
 ARTICLE WITH THE LICENSEE. THE SECRETARY MAY, IN HIS OR HER  DISCRETION,
 PROHIBIT  ANY  PERSON FROM ACCESSING THE INFORMATION OR SOURCE CODE OF A
 LICENSEE PROVIDED HOWEVER THAT THE SECRETARY  SHALL  PROVIDE  A  WRITTEN
 JUSTIFICATION FOR SUCH A PROHIBITION.
   2. FOR PURPOSES OF THIS SECTION, "BIOMETRIC INFORMATION" SHALL INCLUDE
 A PERSON'S:
   (A) FACEPRINT;
   (B) VOICEPRINT;
   (C) FINGERPRINT;
   (D) GAITPRINT;
   (E) IRISPRINT;
   (F) PSYCHOLOGICAL PROFILE; OR
   (G) ANY OTHER DATA RELATED TO A PERSON'S BODY OR MIND THAT CAN BE USED
 TO IDENTIFY A PERSON.
   3.  THIS  SECTION  SHALL  ONLY  APPLY  TO  THE  SHARING OF INFORMATION
 RECEIVED OR GENERATED BY THE LICENSEE OR  SOURCE  CODE  CREATED  BY  THE
 LICENSEE  AND SHALL NOT APPLY TO A THIRD PARTY INTEGRATING THEIR SYSTEMS
 WITH THE LICENSEE.
   § 423. THIRD-PARTY SYSTEMS; CERTIFICATES OF COMPLIANCE. 1.  NON-LICEN-
 SEE THIRD-PARTY SYSTEMS MAY INTEGRATE WITH A LICENSEE UNDER THE  FOLLOW-
 ING CONDITIONS:
   (A)  WHERE  A  THIRD-PARTY SYSTEM ASSISTS IN THE PROPER FUNCTIONING OF
 THE LICENSEE OR WHERE SUCH SYSTEM PROVIDES ADDITIONAL  SERVICES  TO  THE
 LICENSEE'S  SERVICE-OFFERINGS,  SUCH  A  SYSTEM SHALL NOT BE REQUIRED TO
 OBTAIN A LICENSE BUT SHALL  BE  REQUIRED  TO  OBTAIN  A  CERTIFICATE  OF
 COMPLIANCE IN ACCORDANCE WITH THIS SECTION.
   (B)  NO  THIRD-PARTY  SYSTEM  MAY  ACCESS  THE SYSTEM OF A LICENSEE TO
 PROVIDE ITSELF WITH NEW HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE CAPA-
 BILITIES WITHOUT FIRST OBTAINING A LICENSE.
   2. EVERY THIRD-PARTY SYSTEM WHICH INTEGRATES WITH  A  LICENSEE  SHALL,
 PRIOR TO INTEGRATION, APPLY FOR AND RECEIVE A CERTIFICATE OF COMPLIANCE.
 SUCH  CERTIFICATE  SHALL  BE  ISSUED BY THE DEPARTMENT AND SHALL ONLY BE
 ISSUED WHERE SUCH THIRD-PARTY SYSTEM IS ASSESSED BY THE  DEPARTMENT  AND
 THE  DEPARTMENT  FINDS IT CONFORMS TO THE CYBERSECURITY STANDARDS SET BY
 THE OFFICE.  THE SECRETARY SHALL SET THE RULES AND REGULATIONS REGARDING
 THE APPLICATION AND REQUIREMENTS OF RECEIVING A CERTIFICATE  OF  COMPLI-
 ANCE.   THIS SECTION SHALL NOT BE CONSTRUED AS REQUIRING ANY THIRD-PARTY
 SYSTEM TO RECEIVE MORE THAN ONE CERTIFICATE OF COMPLIANCE.
   § 424. LOGGING. EVERY TIME A LICENSEE'S SYSTEM OPERATES IT SHALL AUTO-
 MATICALLY GENERATE A LOG.  STANDARDS RELATED TO THE  SPECIFIC  TYPES  OF
 EVENTS  THAT ARE REQUIRED TO BE LOGGED, THE FORMAT IN WHICH LOGS MUST BE
 KEPT, THE INDIVIDUALS OR ENTITIES  PERMITTED  TO  ACCESS  LOGS  AND  THE
 A. 8195                            17
 
 CONDITIONS  GOVERNING  SUCH  ACCESS,  THE  ENCRYPTION  AND CYBERSECURITY
 PROTOCOLS TO BE APPLIED TO LOGS, THE PROCEDURES FOR BOTH  THE  PRESERVA-
 TION  AND  DISPOSAL  OF  LOGS,  AND  ANY  OTHER ACTIONS PERTINENT TO LOG
 MANAGEMENT  SHALL  CONFORM  TO  THE STANDARDS SET BY THE SECRETARY. SUCH
 LOGS SHALL BE PRESERVED FOR A PERIOD OF TEN YEARS FROM THE DATE THEY ARE
 GENERATED AND SHALL BE SUBJECT TO INSPECTION UNDER SECTION FOUR  HUNDRED
 TWENTY-SIX OF THIS ARTICLE.
   § 425. INTERNAL CONTROLS; CEASING OPERATION. EVERY LICENSEE SHALL HAVE
 IN  PLACE  INTERNAL  CONTROLS  THAT,  WITHIN A REASONABLE TIME FOLLOWING
 INITIATION, CAN SAFELY AND  INDEFINITELY  CEASE  THE  OPERATION  OF  THE
 SYSTEM OR A MAJOR PART OF THE SYSTEM.
   §  426.  INVESTIGATIONS  AND EXAMINATIONS. 1. THE SECRETARY SHALL HAVE
 THE POWER TO MAKE SUCH INVESTIGATIONS AS THE SECRETARY SHALL DEEM NECES-
 SARY TO DETERMINE WHETHER ANY OPERATOR OR ANY OTHER PERSON HAS  VIOLATED
 ANY  OF  THE  PROVISIONS  OF  THIS  ARTICLE, OR WHETHER ANY LICENSEE HAS
 CONDUCTED ITSELF IN SUCH MANNER AS WOULD JUSTIFY THE REVOCATION  OF  ITS
 LICENSE, AND TO THE EXTENT NECESSARY THEREFOR, THE SECRETARY MAY REQUIRE
 THE  ATTENDANCE OF AND EXAMINE ANY PERSON UNDER OATH, AND SHALL HAVE THE
 POWER TO COMPEL THE PRODUCTION OF ALL RELEVANT BOOKS, RECORDS, ACCOUNTS,
 DOCUMENTS, SOURCE CODE, AND LOGS.
   2. THE SECRETARY SHALL HAVE THE POWER TO MAKE SUCH EXAMINATIONS OF THE
 BOOKS, RECORDS, ACCOUNTS, DOCUMENTS, SOURCE CODE, AND LOGS USED  IN  THE
 BUSINESS OF ANY LICENSEE AS THE SECRETARY SHALL DEEM NECESSARY TO DETER-
 MINE  WHETHER  ANY  SUCH  LICENSEE HAS VIOLATED ANY OF THE PROVISIONS OF
 THIS ARTICLE.
   3. THE EXPENSES INCURRED IN MAKING ANY EXAMINATION  PURSUANT  TO  THIS
 SECTION  SHALL BE ASSESSED AGAINST AND PAID BY THE LICENSEE SO EXAMINED,
 EXCEPT THAT TRAVELING AND SUBSISTENCE  EXPENSES  SO  INCURRED  SHALL  BE
 CHARGED  AGAINST AND PAID BY LICENSEES IN SUCH PROPORTIONS AS THE SECRE-
 TARY SHALL DEEM JUST AND  REASONABLE,  AND  SUCH  PROPORTIONATE  CHARGES
 SHALL  BE  ADDED  TO  THE ASSESSMENT OF THE OTHER EXPENSES INCURRED UPON
 EACH EXAMINATION.  UPON WRITTEN NOTICE BY THE  SECRETARY  OF  THE  TOTAL
 AMOUNT  OF  SUCH  ASSESSMENT,  THE  LICENSEE SHALL BECOME LIABLE FOR AND
 SHALL PAY SUCH ASSESSMENT TO THE SECRETARY.
   4. ALL REPORTS OF EXAMINATIONS AND INVESTIGATIONS, AND ALL CORRESPOND-
 ENCE AND MEMORANDA CONCERNING OR ARISING OUT  OF  SUCH  EXAMINATIONS  OR
 INVESTIGATIONS,  INCLUDING ANY DULY AUTHENTICATED COPY OR COPIES THEREOF
 IN THE POSSESSION OF ANY LICENSEE OR THE DEPARTMENT, SHALL BE  CONFIDEN-
 TIAL  COMMUNICATIONS,  SHALL NOT BE SUBJECT TO SUBPOENA AND SHALL NOT BE
 MADE PUBLIC UNLESS, IN THE  JUDGMENT  OF  THE  SECRETARY,  THE  ENDS  OF
 JUSTICE  AND  THE  PUBLIC ADVANTAGE WILL BE SUBSERVED BY THE PUBLICATION
 THEREOF, IN WHICH EVENT THE  SECRETARY  MAY  PUBLISH  OR  AUTHORIZE  THE
 PUBLICATION  OF  A COPY OF ANY SUCH REPORT OR OTHER MATERIAL REFERRED TO
 IN THIS SUBDIVISION, OR ANY PART THEREOF, IN SUCH MANNER AS  THE  SECRE-
 TARY MAY DEEM PROPER.
   §  427.  BOOKS,  RECORDS,  SOURCE  CODE, AND LOGS TO BE KEPT. 1. EVERY
 OPERATOR SHALL MAINTAIN SUCH BOOKS, RECORDS, SOURCE CODE,  AND  LOGS  AS
 THE  SECRETARY SHALL REQUIRE PROVIDED HOWEVER THAT EVERY OPERATOR SHALL,
 AT LEAST, MAINTAIN A COPY OF ALL LOGS GENERATED FROM THE SYSTEM AS  WELL
 AS  A  BACKUP  OF EVERY VERSION OF THE SYSTEM WHICH SHALL BE STORED IN A
 SAFE MANNER AS PRESCRIBED BY THE SECRETARY.
   2. BY A DATE TO BE SET BY THE SECRETARY, EACH OPERATOR SHALL  ANNUALLY
 FILE  A  REPORT WITH THE SECRETARY GIVING SUCH INFORMATION AS THE SECRE-
 TARY MAY REQUIRE CONCERNING  THE  BUSINESS  AND  OPERATIONS  DURING  THE
 PRECEDING  CALENDAR  YEAR  OF  THE  OPERATOR  WITHIN THE STATE UNDER THE
 AUTHORITY OF THIS ARTICLE. SUCH REPORT SHALL BE SUBSCRIBED AND  AFFIRMED
 A. 8195                            18
 
 AS  TRUE  BY  THE  OPERATOR UNDER THE PENALTIES OF PERJURY AND BE IN THE
 FORM PRESCRIBED BY THE SECRETARY. IN ADDITION TO  SUCH  ANNUAL  REPORTS,
 THE  SECRETARY  MAY  REQUIRE  OF  OPERATORS  SUCH  ADDITIONAL REGULAR OR
 SPECIAL REPORTS AS THE SECRETARY MAY DEEM NECESSARY TO THE PROPER SUPER-
 VISION OF OPERATORS UNDER THIS ARTICLE. SUCH ADDITIONAL REPORTS SHALL BE
 IN  THE  FORM  PRESCRIBED  BY  THE SECRETARY AND SHALL BE SUBSCRIBED AND
 AFFIRMED AS TRUE UNDER THE PENALTIES OF PERJURY.
   § 428. REGULATIONS AND RULINGS. THE SECRETARY IS HEREBY AUTHORIZED AND
 EMPOWERED TO MAKE SUCH RULES AND REGULATIONS, CONDUCT HEARINGS AND  MAKE
 SUCH  SPECIFIC RULINGS, ORDERS, DEMANDS AND FINDINGS AS MAY BE NECESSARY
 FOR THE PROPER CONDUCT OF THE BUSINESS AUTHORIZED AND LICENSED UNDER AND
 FOR THE ENFORCEMENT OF THIS ARTICLE.
   § 431. SEVERABILITY. IF ANY PROVISION OF THIS ARTICLE OR THE  APPLICA-
 TION  THEREOF  TO ANY PERSON OR CIRCUMSTANCES IS HELD INVALID, THE INVA-
 LIDITY THEREOF SHALL NOT AFFECT OTHER PROVISIONS OR APPLICATIONS OF  THE
 ARTICLE  WHICH  CAN  BE  GIVEN  EFFECT  WITHOUT THE INVALID PROVISION OR
 APPLICATION, AND TO THIS END THE PROVISIONS OF THIS ARTICLE ARE  SEVERA-
 BLE.
   § 2. Section 401 of the state technology law, as added by section 1 of
 part A of this act, is amended by adding a new subdivision 11 to read as
 follows:
   11. "LOG", "LOGS" OR "LOGGING" SHALL MEAN A SYSTEMATIC, CHRONOLOGICAL-
 LY  ORDERED RECORD OF EVENTS PERTAINING TO A SYSTEM'S OPERATIONS, ACTIV-
 ITIES, AND TRANSACTIONS THAT IS IN COMPLIANCE WITH THE STANDARDS SET  BY
 THE  SECRETARY  IN  ACCORDANCE  WITH SECTION FOUR HUNDRED TWENTY-FOUR OF
 THIS ARTICLE. IN THE CONTEXT OF LOGGING, AN EVENT  SHALL  REFER  TO  ANY
 SIGNIFICANT OR NOTABLE OCCURRENCE, ACTION, OR ANOMALY WITHIN THE SYSTEM.
   §  3. Subdivisions 5 and 6 of section 408 of the state technology law,
 as added by section 1 of part A of this act, are renumbered subdivisions
 7 and 8 and two new subdivisions 5 and 6 are added to read as follows:
   5. ANY PERSON WHO KNOWINGLY MAKES ANY INCORRECT STATEMENT OF A MATERI-
 AL FACT IN ANY APPLICATION, REPORT OR STATEMENT FILED PURSUANT  TO  THIS
 ARTICLE,  OR WHO KNOWINGLY OMITS TO STATE ANY MATERIAL FACT NECESSARY TO
 GIVE THE DIRECTOR ANY INFORMATION LAWFULLY REQUIRED BY THE SECRETARY  OR
 REFUSES  TO  PERMIT  ANY  LAWFUL  INVESTIGATION OR EXAMINATION, SHALL BE
 GUILTY OF A MISDEMEANOR AND, UPON CONVICTION, SHALL BE  FINED  NOT  MORE
 THAN  FIVE HUNDRED DOLLARS OR IMPRISONED FOR NOT MORE THAN SIX MONTHS OR
 BOTH, IN THE DISCRETION OF THE COURT.
   6. NO PERSON SHALL MAKE, DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING,
 OR BY ANY METHOD, PRACTICE OR DEVICE, A REPRESENTATION THAT SUCH  ENTITY
 IS  LICENSED UNDER THE LAW EXCEPT THAT A LICENSEE UNDER THIS CHAPTER MAY
 MAKE A REPRESENTATION THAT THE  LICENSEE  IS  LICENSED  AS  A  HIGH-RISK
 ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM UNDER THIS ARTICLE.
   § 4.  This act shall take effect one year after it shall have become a
 law. Effective immediately, the addition, amendment and/or repeal of any
 rule  or  regulation necessary for the implementation of this act on its
 effective date are authorized to be made and completed on or before such
 effective date.
 
                                  PART C
 
   Section 1. The state technology law is amended by adding a new section
 429 to read as follows:
   § 429. ADVANCED ARTIFICIAL INTELLIGENCE ETHICAL CODE OF  CONDUCT.  THE
 FOLLOWING  ETHICAL CODE OF CONDUCT SHALL BE BINDING ON ALL LICENSEES AND
 A. 8195                            19
 
 NON-LICENSEES WHO DEVELOP OR OPERATE  A  HIGH-RISK  ADVANCED  ARTIFICIAL
 INTELLIGENCE SYSTEM:
   RESPECT: ARTIFICIAL INTELLIGENCE SYSTEMS SHOULD RESPECT HUMAN AUTONOMY
 AND  NOT  UNDULY  INFLUENCE OR MANIPULATE INDIVIDUALS' BEHAVIOR OR DECI-
 SIONS.
   EQUITY: AN ARTIFICIAL INTELLIGENCE  SYSTEM  SHOULD  PROVIDE  EQUITABLE
 OUTCOMES,  IRRESPECTIVE  OF  ANY CHARACTERISTICS PROTECTED BY LAW.  THEY
 SHOULD NOT PERPETUATE EXISTING BIASES, DISCRIMINATION, OR DISPARITIES.
   ACCOUNTABILITY: PERSONS THAT DESIGN, DEVELOP, DEPLOY, OR  USE  ARTIFI-
 CIAL INTELLIGENCE SYSTEMS SHOULD BE HELD ACCOUNTABLE FOR THE IMPACTS AND
 OUTCOMES  OF  THESE  SYSTEMS  EXCEPT  WHERE  THE LAW PROVIDES OTHERWISE.
 CLEAR MECHANISMS FOR ADDRESSING HARMS AND VIOLATIONS OF LAW SHOULD BE IN
 PLACE.
   CARE:  ARTIFICIAL  INTELLIGENCE  SYSTEMS  SHOULD  NOT  CAUSE  HARM  OR
 ADVERSELY  AFFECT INDIVIDUALS, SOCIETY, OR THE ENVIRONMENT WITHOUT LEGAL
 JUSTIFICATION.
   TRUST: ARTIFICIAL INTELLIGENCE  SYSTEMS  SHOULD  RESPECT  INDIVIDUALS'
 PRIVACY  RIGHTS,  AND  SECURELY  HANDLE  PERSONAL  AND SENSITIVE DATA IN
 ACCORDANCE WITH APPLICABLE LAWS AND REGULATIONS.
   INCLUSIVITY:  ARTIFICIAL  INTELLIGENCE  SYSTEMS  SHOULD  BE  DESIGNED,
 DEVELOPED,  AND USED IN WAYS THAT ARE INCLUSIVE, SERVING A DIVERSE RANGE
 OF USERS AND CONTEXTS.
   OVERSIGHT: THERE SHOULD ALWAYS BE MEANINGFUL HUMAN OVERSIGHT OF  ARTI-
 FICIAL INTELLIGENCE SYSTEMS TO ENSURE ETHICAL USE AND DECISION-MAKING.
   NOTICE:  THE OPERATIONS, DECISION-MAKING PROCESSES, AND USE OF ARTIFI-
 CIAL INTELLIGENCE SYSTEMS SHOULD,  WHERE  FEASIBLE,  BE  MADE  KNOWN  TO
 PERSONS AFFECTED BY THEM.
   SAFETY:  ARTIFICIAL INTELLIGENCE SYSTEMS SHOULD BE ROBUST, SECURE, AND
 RELIABLE. THEY SHOULD HAVE MECHANISMS IN  PLACE  TO  PREVENT  MISUSE  OR
 HARMFUL OUTCOMES.
   § 2. This act shall take effect on the one hundred eightieth day after
 it shall have become a law.
 
                                  PART D
 
   Section  1.   Legislative findings and determinations. The legislature
 hereby finds and declares that in the instance where the source code  of
 any  system with the capacity to destroy or disrupt the security, integ-
 rity, and moral well-being of the state is created, a palpable  opportu-
 nity  arises  for such source code to be accessed by entities beyond the
 jurisdictional boundaries of not only the state of New York but also the
 United States; under these circumstances, no oversight, law, rule, regu-
 lation or existing technologies can sufficiently  thwart  the  potential
 misuse  of  such  a  system. Therefore, in recognizing the severe impli-
 cations of this threat, the legislature  hereby  declares  that  certain
 applications  of artificial intelligence harbor such an immense capacity
 for causing significant harm to the security, integrity, and moral well-
 being of the state and such a risk of becoming  uncontainable  that  the
 state has a compelling interest in preventing their creation.
   §  2.  The state technology law is amended by adding a new section 430
 to read as follows:
   § 430. PROHIBITED ARTIFICIAL INTELLIGENCE SYSTEMS.  1. NO PERSON SHALL
 DEVELOP, IN WHOLE OR IN PART,  OR  OPERATE  AN  ARTIFICIAL  INTELLIGENCE
 SYSTEM  WITHIN THE STATE WHERE SUCH A SYSTEM PERFORMS ANY OF THE FOLLOW-
 ING, WHETHER OR NOT IT IS THE SYSTEM'S MAIN FUNCTION:
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   (A) THE DEPLOYMENT OF SUBLIMINAL TECHNIQUES  THAT  OPERATE  BEYOND  AN
 INDIVIDUAL'S CONSCIOUS AWARENESS, WITH THE EXPRESS PURPOSE OF MATERIALLY
 DISTORTING  AN  INDIVIDUAL'S BEHAVIOR IN SUCH A MANNER THAT LEADS TO, OR
 POSSESSES A HIGH LIKELIHOOD OF LEADING  TO,  PHYSICAL  OR  PSYCHOLOGICAL
 HARM  TO  THAT INDIVIDUAL OR ANOTHER, OR THAT LEVERAGES THE VULNERABILI-
 TIES OF A DEFINED GROUP OF INDIVIDUALS TO SIMILAR ENDS;
   (B) THE INFLICTION OF PHYSICAL  OR  EMOTIONAL  HARM  UPON  INDIVIDUALS
 WITHOUT  ANY VALID LAW ENFORCEMENT OR SELF-DEFENSE PURPOSE OR JUSTIFICA-
 TION;
   (C) THE PREDICTION OF AN INDIVIDUAL'S  FUTURE  ACTIONS  OR  BEHAVIORS,
 FOLLOWED BY SUBSEQUENT REACTIONS BASED ON THESE PREDICTIONS, CARRIED OUT
 IN  SUCH  A  WAY  THAT,  WITHOUT  LEGAL JUSTIFICATION, INFRINGES UPON OR
 COMPROMISES  THE  INDIVIDUAL'S  LIBERTY,  EMOTIONAL,  PSYCHOLOGICAL,  OR
 FINANCIAL INTERESTS;
   (D)  THE  UNAUTHORIZED  ACQUISITION, RETENTION, OR DISSEMINATION OF OR
 ACCESS TO SENSITIVE PERSONAL INFORMATION OR NON-PUBLIC DATA IN VIOLATION
 OF APPLICABLE DATA PRIVACY, SECURITY, AND HACKING LAWS; OR
   (E) THE  IMPLEMENTATION  OF  ANY  FORM  OF  AUTONOMOUS  WEAPON  SYSTEM
 DESIGNED  TO  INFLICT HARM ON PERSONS, PROPERTY, OR THE ENVIRONMENT THAT
 LACK MEANINGFUL HUMAN SUPERVISION OR CONTROL.  "MEANINGFUL HUMAN  SUPER-
 VISION OR CONTROL" SHALL MEAN THE ABILITY TO ACTIVELY MANAGE, INTERVENE,
 OR OVERRIDE THE AUTONOMOUS WEAPON SYSTEM'S FUNCTIONS.
   2.  WHERE  THE  SECRETARY  DISCOVERS THE DEVELOPMENT OR OPERATION OF A
 PROHIBITED ARTIFICIAL INTELLIGENCE SYSTEM, THE SECRETARY MAY,  IN  WRIT-
 ING,  DEMAND  THAT THE PERSON WHO IS DEVELOPING OR OPERATING SUCH SYSTEM
 CEASE DEVELOPMENT OR OPERATION OF OR ACCESS TO SUCH A  SYSTEM  WITHIN  A
 PERIOD  OF  TIME  AS THE SECRETARY DEEMS NECESSARY TO PREVENT THE SYSTEM
 FROM WIDESPREAD USE OR, IF THE SYSTEM IS OPERATIONAL  OR  ACCESSIBLE  TO
 PERSONS  FOR  USE, TO ENSURE THE SYSTEM IS PROPERLY TERMINATED IN SUCH A
 WAY TO MINIMIZE RISKS OF HARM TO INDIVIDUALS, SOCIETY, OR  THE  ENVIRON-
 MENT.  A DEMAND MADE PURSUANT TO THIS SECTION SHALL BE FINALLY AND IRRE-
 VOCABLY BINDING ON THE PERSON UNLESS THE PERSON AGAINST WHOM THE  DEMAND
 IS  MADE  SHALL,  WITHIN SUCH PERIOD OF TIME SET BY THE SECRETARY, AFTER
 THE GIVING OF NOTICE OF SUCH DETERMINATION, PETITION THE DEPARTMENT  FOR
 A  HEARING  TO DETERMINE THE LEGAL FINDINGS OF THE SECRETARY. THE PERSON
 DEVELOPING OR OPERATING SUCH A PROHIBITED SYSTEM SHALL, PRIOR  TO  PETI-
 TION,  CEASE  DEVELOPMENT, OPERATION, AND ACCESS TO THE SYSTEM UNTIL AND
 UNLESS SUCH DETERMINATION IS FAVORABLE TO THE PERSON. SUCH DETERMINATION
 MAY BE APPEALED BY ANY PARTY AS OF RIGHT.
   3. THE SECRETARY SHALL NOT GRANT A LICENSE PURSUANT TO THIS ARTICLE TO
 ANY HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE  SYSTEM  DESCRIBED  UNDER
 THIS SECTION EXCEPT AS DESCRIBED IN SUBDIVISION SEVEN OF THIS SECTION.
   4.  ANY  MEMBER,  OFFICER,  DIRECTOR OR EMPLOYEE OF AN OPERATOR OF ANY
 ENTITY WHO KNOWINGLY PUBLICLY OR PRIVATELY OPERATES ANY SYSTEM DESCRIBED
 IN THIS SECTION SHALL BE GUILTY OF A CLASS D FELONY AND  SHALL  INCUR  A
 CIVIL  PENALTY  OF THE AMOUNT EARNED FROM THE CREATION OF THE PROHIBITED
 SYSTEM OR THE AMOUNT OF DAMAGES  CAUSED  BY  THE  SYSTEM,  WHICHEVER  IS
 GREATER.
   5.  THIS  SECTION  SHALL NOT BE CONSTRUED AS IMPOSING LIABILITY ON ANY
 MEMBER, OFFICER, DIRECTOR OR EMPLOYEE WHO HAD NO  EXPLICIT  OR  IMPLICIT
 KNOWLEDGE  OF  THE PROHIBITED HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE
 SYSTEM PROVIDED HOWEVER THAT WHERE THE SECRETARY SENDS A DEMAND TO CEASE
 THE DEVELOPMENT, OPERATION, OR ACCESS TO SUCH SYSTEM ALL MEMBERS,  OFFI-
 CERS,  AND  DIRECTORS  SHALL BE REBUTTABLY PRESUMED TO HAVE KNOWLEDGE OF
 THE PROHIBITED HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM.
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   6. THIS SECTION SHALL BE CONSTRUED AS PROHIBITING THE DEVELOPMENT OF A
 PROHIBITED HIGH-RISK ADVANCED ARTIFICIAL INTELLIGENCE SYSTEM  OR  MAKING
 SUCH A SYSTEM ACCESSIBLE TO PERSONS IN THE STATE OF NEW YORK.
   7.  NOTWITHSTANDING  SUBDIVISION  ONE  OF  THIS  SECTION, A PERSON MAY
 DEVELOP A PROHIBITED HIGH-RISK ADVANCED ARTIFICIAL  INTELLIGENCE  SYSTEM
 WHERE  AUTHORIZED  BY THE SECRETARY, PROVIDED THAT SUCH SYSTEM IS DEVEL-
 OPED AND USED ONLY BY THE STATE OR WITH  SUBSTANTIAL,  CONTINUOUS  OVER-
 SIGHT BY THE STATE AND SUCH SYSTEM IS AUTHORIZED ONLY AFTER PUBLIC HEAR-
 ING  AND  COMMENT  IN  ACCORDANCE WITH SECTION FOUR HUNDRED NINE OF THIS
 ARTICLE.
   § 2. This act shall take effect one year after it shall have become  a
 law. Effective immediately, the addition, amendment and/or repeal of any
 rule  or  regulation necessary for the implementation of this act on its
 effective date are authorized to be made and completed on or before such
 effective date.
   § 4. Severability clause. If any clause, sentence, paragraph, subdivi-
 sion, section or part of this act shall be  adjudged  by  any  court  of
 competent  jurisdiction  to  be invalid, such judgment shall not affect,
 impair, or invalidate the remainder thereof, but shall  be  confined  in
 its  operation  to the clause, sentence, paragraph, subdivision, section
 or part thereof directly involved in the controversy in which such judg-
 ment shall have been rendered. It is hereby declared to be the intent of
 the legislature that this act would  have  been  enacted  even  if  such
 invalid provisions had not been included herein.
   §  5.  This act shall take effect immediately; provided, however, that
 the applicable effective date of Parts A through D of this act shall  be
 as specifically set forth in the last section of such Parts.