A sweeping federal bill that advanced through the U.S. House of Representatives in June 2025 contains a controversial provision that would impose a 10-year moratorium on states enforcing their own laws regulating artificial intelligence. The provision would prohibit states from enforcing any law or regulation that limits or restricts AI systems involved in interstate commerce.
A revised version proposed in the Senate would tie this preemption to federal broadband funding, creating a choice for states between regulating AI and receiving the funds. This federal move has sparked bipartisan opposition from state lawmakers and attorneys general, who argue it would undermine consumer protections and erase years of legislative work. The proposal comes as states have taken the lead on AI governance, introducing over 1,000 AI-related bills and enacting more than 75 new laws in 2025 alone on issues such as algorithmic bias, child safety, and consumer transparency.
Source: PYMNTS