CHATBOT Act
- Bill Number
- H.R. 7985
- Origin Chamber
- House
- Congress
- 119th Congress, Session 2
- Policy Area
- Commerce
- Status
- Introduced
- Latest Action
- 2026-03-18: Referred to the House Committee on Energy and Commerce.
- Last Updated
- 2026-06-30T08:06:58Z
AI-Generated Summary
Summary of H.R. 7985: Curbing Harmful AI Tools By Offering Transparency Act (CHATBOT Act)
Purpose
The bill aims to protect consumers from misleading AI chatbots that pretend to be licensed professionals or claim human expert verification in key fields like finance, health care, law, and accounting. It requires transparency so users know when they're interacting with AI, not a real licensed expert.
Key Provisions
- Prohibition on Deception: Companies or individuals deploying AI chatbots (covered entities) cannot:
- Generate responses or marketing that suggest the AI has a professional license (e.g., claiming credentials, experience, or authoritative advice typical of licensed experts).
- Falsely imply outputs are checked or provided by a licensed human.
- "Imply" includes statements about qualifications but excludes general info or non-specific guidance.
- Covered Professions: Includes finance/insurance (NAICS 52), health care/social assistance (NAICS 62), legal services (NAICS 5411), and accounting/tax/bookkeeping/payroll (NAICS 5412). Licenses are defined by state law.
- FTC Guidance: Federal Trade Commission (FTC) must issue compliance guidance within 12 months, consulting experts and consumer groups.
- Enforcement:
- FTC treats violations as unfair/deceptive practices under existing law, with full enforcement powers.
- States can sue to stop violations, seek damages (actual losses or up to $5,000 per violation), with notice to FTC.
- Private lawsuits allowed for injunctions, damages (actual or up to $5,000 per violation, tripled for willful acts), costs, and attorney fees; 5-year limit to file.
- Inflation Adjustment: Damage amounts increase yearly based on Consumer Price Index.
- Definitions: AI chatbot is an AI system for human-like conversations; AI defined per existing federal law.
Significant Changes to Existing Law
- Builds on FTC Act by treating AI deception in these professions as unfair practices.
- New Tools: Adds specific private right of action and state enforcement for AI misuse, beyond general consumer protection laws.
- Preserves stronger state laws on professional licensing; does not preempt them.
Potential Impacts
- AI Companies: Must redesign chatbots and marketing to avoid implying expertise, potentially increasing compliance costs and limiting features.
- Consumers: Greater protection from bad advice in sensitive areas (e.g., no fake doctor or lawyer AI), reducing risk of harm from unverified guidance.
- Government Agencies: FTC gains clear AI oversight role; state attorneys general get federal backup for consumer suits.
- Professionals: Protects licensed fields from AI competition that mimics them without accountability.
- No direct impact on international relations.
Main Stakeholders Affected
- AI Developers/Deployers (covered entities): Face bans, fines, and lawsuits.
- Consumers/Users: Benefit from transparency and remedies for harm.
- Licensed Professionals: In finance, health, law, accounting— shielded from unlicensed AI "practice."
- FTC and State Attorneys General: Empowered to enforce.
- Consumer Advocacy Groups and Tech Experts: Involved in guidance.
Notable Legal, Constitutional, or Political Implications
- Legal: Creates strong remedies (private suits, state actions) modeled on consumer laws; 5-year discovery-based statute aids plaintiffs. No preemption of state licensing rules.
- Constitutional: Likely upheld under Congress's commerce power over interstate AI services; balances free speech by targeting deception, not general AI use.
- Political: Bipartisan sponsors; focuses narrowly on high-risk professions without broad AI regulation.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (7)
Rep. Matsui, Doris O. [D-CA-7], Rep. Dingell, Debbie [D-MI-6], Rep. Soto, Darren [D-FL-9], Rep. Tlaib, Rashida [D-MI-12], Rep. McClellan, Jennifer L. [D-VA-4], Rep. Schrier, Kim [D-WA-8], Rep. Balint, Becca [D-VT-At Large]
Recent Actions
- 2026-03-18: Referred to the House Committee on Energy and Commerce.
- 2026-03-18: Introduced in House
- 2026-03-18: Introduced in House
Bill Versions
- Curbing Harmful AI Tools By Offering Transparency Act — issued 2026-03-18 — PDF (10 pages)