Pennsylvania will require labels on AI-generated ads

New ads you see may start including AI disclosure labels, which were not required yesterday.

Pennsylvania Governor Josh Shapiro has signed the Artificial Intelligence Deceptive Advertising Act into law, mandating labels on AI-generated or significantly modified advertisements. This requirement applies to various media formats, including images, videos, audio, and text, and must be presented in a manner consistent with the ad's format. The law covers advertisements from large corporations to small businesses and extends to ads created elsewhere if they are expected to be seen in Pennsylvania. However, the act contains ambiguities regarding what constitutes "significantly modified" and includes exemptions for content deemed "parody, satire, commentary, criticism," or "evidently fictional." Further vagueness exists around what constitutes a "false consumer perception" regarding products or services, leaving interpretation open.

Pennsylvania's new law signals a growing regulatory trend to address concerns around AI-generated content and its potential to mislead consumers. By requiring explicit disclosures, the state aims to provide transparency, but the broad definitions and numerous loopholes leave significant room for interpretation and potential evasion. This could lead to a patchwork of enforcement and compliance challenges for advertisers operating across state lines, necessitating careful legal review of their AI usage in marketing materials.

The legislation highlights the evolving landscape of AI regulation, with states attempting to balance innovation with consumer protection. Companies utilizing AI for advertising will need to proactively assess their content and consider implementing robust internal review processes to determine compliance with "significantly modified" and "evidently fictional" clauses. The subjective nature of these terms suggests that legal challenges and further clarification through case law or subsequent legislative amendments are likely.