AI Frontier Institute

Trade: business regulation; availability of companion chatbots to minors; prohibit. Creates new act.

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Michigan Senate Bill 760, the 'Leading Ethical AI Development for Kids Act,' regulates operators of advanced chatbots—defined in Section 3 as generative AI systems with natural language interfaces providing ongoing, adaptive responses—with respect to protecting minors (residents under 18). Section 3 carves out several systems from the definition of 'advanced chatbot,' including customer-service-only systems, internal business tools, clinical systems under health-professional supervision, and narrowly tailored curriculum-aligned educational tools. Section 4 restricts chatbot operators to collecting only the minimum personal data necessary, prohibits sharing or selling that data to third parties, and requires immediate deletion after determining whether a user is a minor. Section 5 prohibits making certain design features available to minors unless the operator has actual knowledge the user is not a minor; banned features include simulated companionship or interpersonal relationships (e.g., outputs suggesting the chatbot is human or has emotions), promotion of suicide or self-harm, encouragement of secrecy or isolation, engagement-optimization that overrides safety guardrails, and sexually explicit content or child sexual abuse material. Section 5 also prohibits training an advanced chatbot's underlying model on a minor's inputs without affirmative written parental consent. Section 7 authorizes the attorney general to bring civil actions seeking up to $25,000 per day per violation, injunctive relief, restitution, disgorgement, and attorney fees; it also grants a private right of action to harmed minors or their guardians for actual damages, punitive damages, and related relief, and establishes a rebuttable presumption of causation when a minor is harmed after the chatbot encouraged the harmful conduct. Section 11 voids contracts that waive or burden enforcement of the act or shift liability to users. Section 13 requires the attorney general to maintain a public website for reporting violations. Section 19 directs the attorney general to promulgate rules to implement the act; Sections 4 and 5 take effect only after those initial rules are issued.

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