President Donald Trump signed an executive order Thursday issuing a single regulation framework for artificial intelligence, undermining the power of individual states.
"To win, United States AI companies must be free to innovate without cumbersome regulation," the order says. "But excessive State regulation thwarts this imperative."
The Trump administration, with the aid of AI and crypto czar David Sacks, has been pursuing a path that would allow federal rules to preempt state regulations on AI, a move meant to keep big Democratic-led states like California and New York from exerting their control over the growing industry.
Sacks and fellow tech investor and podcaster Chamath Palihapitiya stood beside Trump during the signing in the Oval Office. He was also joined by Sen. Ted Cruz (R-TX) and Commerce Secretary Howard Lutnick.
The move marks a win for tech companies like OpenAI and Google and venture firm Andreessen Horowitz that have lobbied to limit regulations they view as overly burdensome. AI companies have been opening offices close to the Capitol and launching campaigns through a super PAC with at least $100 million to spend on the midterm elections in 2026.Â
Proponents of a federal rule have argued that different regulations across the country would hinder the U.S. in its effort to compete in the global AI race. A draft version of a proposed executive order surfaced last month, for a single federal standard on AI "instead of a patchwork of 50 State Regulatory Regimes."
A proposed 10-year ban on states regulating AI was initially included in the Republican spending bill but was cut out before Trump signed it in July.
Trump's executive order also calls for the attorney general to establish an AI Litigation Task Force, "whose sole responsibility shall be to challenge State AI laws."
States that don't adhere to the rules could face funding restrictions. The order says that within 90 days of its signing, the secretary of commerce must specify the conditions under which states may be eligible to receive remaining funding under the Broadband Equity Access and Deployment, or BEAD, program, a $42.5 billion effort to expand high-speed access in rural areas.
This is breaking news. Please check back for updates.