Senate defers AI-chatbot disclosure bill amid implementation and enforcement concerns

Senators heard testimony Feb. 7 on SB 640, a proposal to require businesses to disclose when consumers are interacting with artificial-intelligence chatbots or technologies capable of mimicking human behavior. The bill as drafted also authorizes private rights of action and establishes statutory penalties.

Dylan Hoffman of TechNet testified in respectful opposition, saying TechNet ‘‘understand[s] the need for consumers to be aware of their interactions with chatbots’’ but warned the bill’s definitions—particularly of "AI chatbot"—contain undefined terms that could sweep in many technologies across industries. Hoffman urged more tailored definitions to avoid unintended coverage and recommended placing enforcement authority with the state Attorney General rather than an open private right of action.

Office of Consumer Protection staff stood on written comments and raised enforcement questions. A small-business witness told the committee that broad disclosure and private litigation risk could harm small businesses that rely on AI tools for operations, noting that 99.3% of Hawaii businesses are small businesses.

Senators questioned the OCP and others about who would enforce the statute and whether treble damages and private enforcement provisions could be challenged in court. The committee concluded the measure required more work and recommended deferring decision-making so sponsors and stakeholders could refine language.

Next steps: the committee deferred SB 640 to allow clearer definitions and to consider enforcement options, including the possibility of assigning primary enforcement to the Attorney General instead of creating a broad private right of action.