,,ib ,union ,cal5d> ,no4 #fai #aai? ,,congress #b;d ,session ,h4 ,r4 #dhja ,report ,no4 #aai-gac ,,9 ,,! ,,h\se ,,( ,,repres5tatives ,july #bi1 #bjbe,mr4 ,hill ( ,arkansas 7= himself1 ,mr4 ,torres ( ,new ,york1 ,mr4 ,/eil1 & ,mr4 ,got!im]7 introduc$ ! foll[+ bill2 :i* 0 ref]r$ to ! ,committee on ,f9ancial ,s]vices ,june #bd1 #bjbf,report$ ) an am5dm5t1 committ$ to ! ,committee ( ! ,:ole ,h\se on ! ,/ate ( ! ,union1 & ord]$ to be printed,strike out all aft] ! enact+ clause & ins]t ! "p pr9t$ 9 italic,for text ( introduc$ bill1 see copy ( bill z introduc$ on ,july #bi1 #bjbe ,a ,,bill ,to e/abli% ,,ai ,innovation ,labs t p]mit c]ta9 p]sons to exp]im5t ) artificial intellig5ce )\t expectation ( en=cem5t actions4 #a4 ,%ort title ,?is ,act may be cit$ z ! ,unlea%+ ,,ai ,innovation 9 ,f9ancial ,s]vices ,act4 #b4 ,def9itions ,9 ?is section3 7#a7 ,,ai te/ project ,! t]m ,,ai te/ project means a f9ancial product1 s]vice1 or activity-- 7,a7 t falls "u ! jurisdiction ( a f9ancial regulatory ag5cy2 7,b7 t makes sub/antial use ( artificial intellig5ce2 7,c7 t is1 or may be1 subject to a ,f$]al regulation or ,f$]al /atute2 & 7,d7 = :i* a regulat$ entity submits an application = ! waiv] or modification ( an applicable regulation subject to an alt]native compliance /rategy4 7#b7 ,appropriate f9ancial regulatory ag5cy ,! t]m appropriate f9ancial regulatory ag5cy means-- 7,a7 ! appropriate ,f$]al bank+ ag5cy1 z def9$ 9 section #c ( ! ,f$]al ,deposit ,insurance ,act 7#ab ,u4,s4,c4 #ahac71 ) respect to an in/itution describ$ 9 subsection 7q7 ( t section2 7,b7 ! ,securities & ,ex*ange ,commission1 ) respect to an in/itution n describ$ 9 subp>agraph 7,a7 t is-- 7i7 any brok] or deal] t is regi/]$ ) ! ,commission "u ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7ii7 any inve/m5t company t is regi/]$ ) ! ,commission "u ! ,inve/m5t ,company ,act ( #aidj 7#ae ,u4,s4,c4 #hj;a-#a et seq472 7iii7 any inve/m5t advis] t is regi/]$ ) ! ,commission "u ! ,inve/m5t ,advis]s ,act ( #aidj 7#ae ,u4,s4,c4 #hj;b-#a et seq472 7iv7 any cle>+ ag5cy regi/]$ ) ! ,commission "u ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7v7 any nationally recogniz$ /ati/ical rat+ organization regi/]$ ) ! ,commission "u ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7vi7 any transf] ag5t regi/]$ ) ! ,commission "u ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7vii7 any ex*ange regi/]$ z a national securities ex*ange ) ! ,commission "u ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7viii7 any national securities association regi/]$ ) ! ,commission "u ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7ix7 any securities in=mation processor regi/]$ ) ! ,commission "u ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7x7 ! ,municipal ,securities ,rulemak+ ,bo>d e/abli%$ "u ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7xi7 ! ,public ,company ,acc\nt+ ,ov]sight ,bo>d e/abli%$ "u ! ,s>banes-,oxley ,act ( #bjjb 7#ae ,u4,s4,c4 #gbaa et seq472 7xii7 ! ,securities ,inve/or ,protection ,corporation e/abli%$ "u ! ,securities ,inve/or ,protection ,act ( #aigj 7#ae ,u4,s4,c4 #gh;aaa et seq472 & 7xiii7 any security-bas$ swap execution facility1 security-bas$ swap data repository1 security-bas$ swap deal]1 or major security-bas$ swap p>ticipant regi/]$ ) ! ,commission "u ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7,c7 ! ,bureau ( ,consum] ,f9ancial ,protection1 ) respect to a cov]$ p]son1 z def9$ 9 section #ajjb ( ! ,consum] ,f9ancial ,protection ,act ( #bjaj 7#ab ,u4,s4,c4 #edha71 t does n h an appropriate f9ancial regulatory ag5cy "u subp>agraph 7,a71 7,b71 7,d71 or 7,e7 ( ?is p>agraph2 7,d7 ! ,national ,cr$it ,union ,adm9i/ration1 ) respect to an insur$ cr$it union1 z def9$ 9 section #aja ( ! ,f$]al ,cr$it ,union ,act 7#ab ,u4,s4,c4 #ageb72 & 7,e7 ! ,f$]al ,h\s+ ,f9ance ,ag5cy1 ) respect to-- 7i7 a ,f$]al ,home ,loan ,bank2 7ii7 ! ,f$]al ,home ,loan ,bank ,sy/em2 7iii7 ! ,f$]al ,national ,mortgage ,association2 & 7iv7 ! ,f$]al ,home ,loan ,mortgage ,corporation4 7#c7 ,artificial intellig5ce2 ,,ai ,! t]ms artificial intellig5ce & ,,ai h ! mean+ giv5 ! t]m artificial intellig5ce 9 section #ejjb ( ! ,national ,artificial ,intellig5ce ,initiative ,act ( #bjbj 7#ae ,u4,s4,c4 #idja74 7#d7 ,commission ,! t]m ,commission means ! ,securities & ,ex*ange ,commission4 7#e7 ,f$]al securities laws ,! t]m ,f$]al securities laws means-- 7,a7 ! ,securities ,act ( #aicc 7#ae ,u4,s4,c4 #gg;a et seq472 7,b7 ! ,securities ,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4 #gh;a et seq472 7,c7 ! ,s>banes-,oxley ,act ( #bjjb 7#ae ,u4,s4,c4 #gbja et seq472 7,d7 ! ,tru/ ,ind5ture ,act ( #aici 7#ae ,u4,s4,c4 #gg;aaa et seq472 7,e7 ! ,inve/m5t ,company ,act ( #aidj 7#ae ,u4,s4,c4 #hj;a-#a et seq472 7,f7 ! ,inve/m5t ,advis]s ,act ( #aidj 7#ae ,u4,s4,c4 #hj;b-#a et seq472 7,g7 ! ,jump/>t ,our ,bus9ess ,/>tup ,act 7,public ,law #aab-ajf2 #abf ,/at4 #cjf72 & 7,h7 ! ,dodd-,frank ,wall ,/reet ,re=m & ,consum] ,protection ,act 7,public ,law #aaa-bjc2 #abd ,/at4 #acgf74 7#f7 ,f9ancial product1 s]vice1 or activity ,! t]m f9ancial product1 s]vice1 or activity-- 7,a7 includes-- 7i7 a f9ancial product or s]vice1 z def9$ 9 section #ajjb ( ! ,consum] ,f9ancial ,protection ,act ( #bjaj 7#ab ,u4,s4,c4 #edha72 7ii7 activities t are f9ancial 9 nature1 z def9$ 9 section #d7k77#d7 ( ! ,bank ,hold+ ,company ,act ( #aief 7#ab ,u4,s4,c4 #ahdc7k77#d772 7iii7 any f9ancial product or s]vice provid$ by a p]son regulat$ by ! ,commission1 z def9$ 9 section #ajjb ( ! ,consum] ,f9ancial ,protection ,act ( #bjaj 7#ab ,u4,s4,c4 #edha72 & 7iv7 ! (f] or sale ( any security subject to ! ,f$]al securities laws2 7,b7 includes any int]nal activity ( a regulat$ entity t is c>ri$ out 9 fur!rance ( ! (f]+ or sale ( a product1 s]vice1 or activity describ$ 9 subp>agraph 7,a72 & 7,c7 does n include ! bus9ess ( insurance1 z def9$ 9 section #ajjb ( ! ,consum] ,f9ancial ,protection ,act ( #bjaj 7#ab ,u4,s4,c4 #edha74 7#g7 ,f9ancial regulatory ag5cy ,! t]m f9ancial regulatory ag5cy means-- 7,a7 ! ,bo>d ( ,gov]nors ( ! ,f$]al ,res]ve ,sy/em2 7,b7 ! ,f$]al ,deposit ,insurance ,corporation2 7,c7 ! ,(fice ( ! ,comptroll] ( ! ,curr5cy2 7,d7 ! ,securities & ,ex*ange ,commission2 7,e7 ! ,bureau ( ,consum] ,f9ancial ,protection2 7,f7 ! ,national ,cr$it ,union ,adm9i/ration2 & 7,g7 ! ,f$]al ,h\s+ ,f9ance ,ag5cy4 7#h7 ,regulat$ entity ,! t]m regulat$ entity means an entity regulat$1 or insur$ 9 ! case ( a cr$it union1 by any f9ancial regulatory ag5cy4 #c4 ,,ai ,innovation ,labs ,ea* f9ancial regulatory ag5cy %all e/abli%1 or id5tify an (fice1 division1 or dep>tm5t ( ! ag5cy t %all s]ve z1 an ,,ai ,innovation ,lab to enable regulat$ entities to exp]im5t ) ,,ai te/ projects )\t unnecess>y or unduly burd5some regulation or expectation ( en=cem5t actions1 includ+ en=cem5t actions t dis9c5tivize ! sub/antial use ( artificial intellig5ce to enhance regulatory compliance practices1 pursuant to ! approval ( an application "u section #d4 #d4 ,use ( artificial intellig5ce by regulat$ f9ancial entities 7a7 ,application submission 7#a7 ,9 g5]al ,beg9n+ "o ye> aft] ! date ( enactm5t ( ?is ,act1 a regulat$ entity may submit to ! appropriate f9ancial regulatory ag5cy an application1 on a =m det]m9$ by ! appropriate f9ancial regulatory ag5cy1 to engage 9 an ,,ai te/ project ?r\gh an ,,ai ,innovation ,lab4 7#b7 ,cont5ts ,an application submitt$ "u p>agraph 7#a7 %all include-- 7,a7 a description ( ! ,,ai te/ project propos$ to be c>ri$ out by ! regulat$ entity1 includ+-- 7i7 ! type & capabilities ( ! relevant ,,ai te*nologies1 sy/ems1 & applications2 & 7ii7 ! purposes & goals ( ! ,,ai te/ project2 7,b7 an alt]native compliance /rategy t-- 7i7 id5tifies a regulation issu$ by a f9ancial regulatory ag5cy t ! regulat$ entity reque/s to be waiv$ or modifi$2 7ii7 proposes an alt]native me?od = ! regulat$ entity to comply ) ! ,f$]al /atute "u :i* ! regulation id5tifi$ 9 clause 7i7 is promulgat$ & ! purpose ( su* regulation1 includ+ an explanation z to :y ! alt]native me?od is ess5tial to ! op]ation ( ! regulat$ entity & h[ ! regulat$ entity w\ld effectively manage risks1 includ+ cyb]security risks1 associat$ ) ! ,,ai te/ project2 7iii7 describes applicable plans & policies relat$ to risk assessm5ts1 te/+1 controls1 docum5tation1 & monitor+ & _! role 9 manag+ risks describ$ "u clause 7ii72 & 7iv7 conta9s policies = ! regulat$ entity to ma9ta91 consi/5t ) applicable law1 cyb]security /&>ds1 & contractual limitations & obligations1 records ( ! activities ( ! ,,ai te/ project1 s long z su* policies d n require ! regulat$ entity to ma9ta9 any records t ! regulat$ entity is n p]mitt$ to ma9ta9 pursuant to ano!r law or any contractual limitation or obligation2 7,c7 an explanation ( h[ "u ! /rategy describ$ 9 subp>agraph 7,b71 ! ,,ai te/ project-- 7i7 w\ld s]ve ! public int]e/1 improve consum] or inve/or access to a f9ancial product1 s]vice1 or activity1 or promote consum] or inve/or protection2 7ii7 w\ld enhance effici5cy or op]ations1 fo/] innovation or competitiv5ess1 improve risk managem5t & security1 includ+ cyb]security1 or enhance regulatory compliance2 7iii7 w\ld n pres5t-- 7,i7 a significant risk ( loss to ! ,deposit ,insurance ,fund or ! ,national ,cr$it ,union ,%>e ,insurance ,fund :]e ! regulat$ entity is an insur$ depository in/itution or insur$ cr$it union2 or 7,,ii7 a sy/emic risk to ! f9ancial sy/em ( ! ,unit$ ,/ates2 7iv7 is consi/5t ) ! purposes ( ! anti-money laund]+ & c\nt]+ ! f9anc+ ( t]rorism obligations "u sub*apt] ,,ii ( *apt] #ec ( title #ca1 ,unit$ ,/ates ,code2 & 7v7 w\ld n pres5t a national security risk to ! ,unit$ ,/ates2 7,d7 a propos$ date on :i* ! ,,ai te/ project w\ld t]m9ate & an explanation :y su* t]m9ation date w\ld be appropriate2 7,e7 propos$ limitations on ! size1 scope1 & gr[? ( ! ,,ai te/ project2 7,f7 a detail$ bus9ess plan2 & 7,g7 an e/imate ( ! economic1 m>ket1 op]ational1 & public int]e/ impact ( ! ,,ai te/ project if approv$4 7#c7 ,jo9t applications ,two or m regulat$ entities may submit a jo9t application to ! same f9ancial regulatory ag5cy "u p>agraph 7#b74 7#d7 ,regulations ( o!r ag5cies 7,a7 ,9 g5]al ,not)/&+ p>agraph 7#b71 a regulat$ entity may submit an application "u ?is subsection = an alt]native compliance /rategy = a regulation issu$ or en=c$ by a f9ancial regulatory ag5cy t is n ! appropriate f9ancial regulatory ag5cy = ! regulat$ entity4 7,b7 ,requirem5ts ,an application describ$ 9 subp>agraph 7,a7 %all be subject to ! same requirem5ts z an application describ$ 9 p>agraph 7#b71 except t-- 7i7 ! regulat$ entity %all submit ! application to-- 7,i7 ! appropriate f9ancial regulatory ag5cy2 & 7,,ii7 any o!r f9ancial regulatory ag5cy t-- 7aa7 issu$ ! regulation t is ! subject ( ! alt]native compliance /rategy & has jurisdiction ov] ! regulat$ entity ) respect to su* regulation2 or 7bb7 en=ces ! regulation t is ! subject ( ! alt]native compliance /rategy ) respect to ! regulat$ entity2 & 7ii7 ! ,,ai te/ project may n take effect unless ! application is jo9tly approv$ by-- 7,i7 ! appropriate f9ancial regulatory ag5cy2 & 7,,ii7 ea* o!r f9ancial regulatory ag5cy describ$ 9 clause 7i77,,ii74 7#e7 ,notice ,a regulat$ entity t is regulat$ by1 or subject to regulations t are en=c$ by1 m ?an #a f9ancial regulatory ag5cy %all provide notice ( any application submitt$ to ! appropriate f9ancial regulatory ag5cy "u ?is section to ea* su* f9ancial regulatory ag5cy n lat] ?an #e bus9ess days aft] ! regulat$ entity submits ! application to ! appropriate f9ancial regulatory ag5cy4 7#f7 ,notice ( int]v5+ ag5cy 7,a7 ,notice ( int]v5tion ,a f9ancial regulatory ag5cy t receives a notice "u p>agraph 7#e7 ) respect to an application reg>d+ a regulation t su* ag5cy issu$ or en=ces may1 )9 #cj days ( receiv+ su* notice1 issue a notice ( int]v5tion to ! regulat$ entity & ! appropriate f9ancial regulatory ag5cy ( su* regulat$ entity4 7,b7 ,jo9t approval requir$ ,if a f9ancial regulatory ag5cy issues a notice ( int]v5tion describ$ 9 subp>agraph 7,a71 ! applicable ,,ai te/ project may n take effect unless su* f9ancial regulatory ag5cy1 jo9tly ) ! f9ancial regulatory ag5cies describ$ 9 p>agraph 7#d77;,b77ii71 approves ! application4 7#g7 ,ag5cy review 7,a7 ,9 g5]al ,except z provid$ 9 subp>agraph 7,d71 n lat] ?an #abj days aft] ! date on :i* a complete application is receiv$ by a f9ancial regulatory ag5cy "u ?is subsection1 ! f9ancial regulatory ag5cy %all-- 7i7 review ! application & assess1 to ! ext5t reasonably practicable1 ! applicant's ability to satisfy ! /&>ds describ$ 9 subp>agraphs 7,b7 & 7,c7 ( p>agraph 7#b72 & 7ii7 submit to ! applicant 9 writ+ a det]m9ation ( ! ag5cy4 7,b7 ,approval 7i7 ,9 g5]al ,if ! applicant %[s t x is m likely ?an n t ! application meets ! requirem5ts = e/abli%+ an alt]native compliance /rategy & satisfies ! /&>ds describ$ 9 subp>agraphs 7,b7 & 7,c7 ( p>agraph 7#b71 ! f9ancial regulatory ag5cy %all approve ! application & notify ! applicant 9 writ+ (-- 7,i7 ! regulation t is ! subject ( ! alt]native compliance /rategy2 7,,ii7 ! t]ms ( ! alt]native compliance /rategy = ! ,,ai te/ project2 7,,iii7 ! date on :i* ! ,,ai te/ project w t]m9ate2 7,,iv7 any limitations on ! size1 scope1 or gr[? ( ! ,,ai te/ project2 & 7,v7 any additional limitations or conditions on ! ,,ai te/ project1 z det]m9$ by ! f9ancial regulatory ag5cy4 7ii7 ,effect ( approval ,) respect to an ,,ai te/ project1 beg9n+ on ! date on :i* an application submitt$ "u p>agraph 7#a7 is approv$ & end+ on ! date describ$ 9 clause 7i77,,iii7-- 7,i7 ! appropriate f9ancial regulatory ag5cy may en=ce a regulation describ$ 9 clause 7i77,i7 only 9 ! mann] set out 9 ! alt]native compliance /rategy describ$ 9 clause 7i77,,ii71 subject to limitations or conditions describ$ 9 subclauses 7,,iv7 & 7,v7 ( clause 7i72 & 7,,ii7 except z provid$ 9 clause 7iii71 a f9ancial regulatory ag5cy t is n ! appropriate f9ancial regulatory ag5cy may n en=ce a regulation describ$ 9 clause 7i77,i74 7iii7 ,en=cem5t by ano!r f9ancial regulatory ag5cy ,) respect to an ,,ai te/ project1 a f9ancial regulatory ag5cy o!r ?an ! appropriate f9ancial regulatory ag5cy may en=ce a regulation describ$ 9 clause 7i77,i7 if-- 7,i7 su* o!r f9ancial regulatory ag5cy issu$ or en=ces su* regulation2 7,,ii7 ! approval ( su* o!r f9ancial regulatory ag5cy 0 requir$ = ! ,,ai te/ project "u p>agraph 7#d77;,b77ii77,,ii7 or 7#f77;,b72 & 7,,iii7 ! alt]native compliance /rategy describ$ 9 subclause clause 7i77,,ii7 provides = en=cem5t by su* o!r f9ancial regulatory ag5cy4 7,c7 ,d5ial1 resubmittal1 & relief 7i7 ,9 g5]al ,if a f9ancial regulatory ag5cy d5ies an application1 ! f9ancial regulatory ag5cy-- 7,i7 %all submit to ! applicant a writt5 notice expla9+ ! reason = d5ial2 & 7,,ii7 may n take an en=cem5t action relat$ to ! propos$ ,,ai te/ project aga9/ ! applicant e>li] ?an ! date t is #cj days aft] ! date on :i* ! f9ancial regulatory ag5cy submits su* writt5 notice4 7ii7 ,resubmittals ,ea* "t an application submitt$ "u p>agraph 7#a7 is d5i$1 ! regulat$ entity-- 7,i7 may submit an am5d$ application aft] receiv+ fe$back f ! f9ancial regulatory ag5cy mak+ su* d5ial2 & 7,,ii7 may n resubmit m ?an #b applications t are sub/antially simil> to ! d5i$ application4 7iii7 ,injunctive relief ,not)/&+ clause 7i77,,ii71 a f9ancial regulatory ag5cy1 by & ?r\gh its own attorneys1 may file a civil action 9 an appropriate ,unit$ ,/ates di/rict c\rt to enjo9 an active ,,ai te/ project if ! f9ancial regulatory ag5cy det]m9es t ! ,,ai te/ project-- 7,i7 pres5ts an imm$iate dang] to consum]s or inve/ors2 or 7,,ii7 pres5ts a risk-- 7aa7 to f9ancial m>kets2 7bb7 9 ! case ( an ,,ai te/ project engag$ 9 by an insur$ depository in/itution or an insur$ cr$it union1 ( loss to a ,f$]al deposit or %>e insurance fund2 7cc7 ( a violation ( anti-money laund]+ & c\nt]+ ! f9anc+ ( t]rorism obligations "u sub*apt] ,,ii ( *apt] #ec ( title #ca1 ,unit$ ,/ates ,code2 or 7dd7 to ! national security ( ! ,unit$ ,/ates4 7iv7 ,rule ( con/ruction on c]ta9 adm9i/rative ord]s ,no?+ 9 clause 7iv7 %all be con/ru$ to limit a f9ancial regulatory ag5cy's au?ority to issue an adm9i/rative ord] to cease ! activity ( an active ,,ai te/ project :]e ! ag5cy det]m9es su* activity is caus+ unmitigable or irrep>able h>m to consum]s1 inve/ors1 or f9ancial /ability4 7,d7 ,ext5sion2 failure to make a det]m9ation ,if a f9ancial regulatory ag5cy det]m9es additional "t is ne$$ to make a det]m9ation on a complete application receiv$ "u ?is subsection1 ! f9ancial regulatory ag5cy may ext5d ! #abj-;day deadl9e by "o additional #abj-;day p]iod4 ,if ! f9ancial regulatory ag5cy does n approve or d5y ! application by ! end ( ! initial #abj-;day p]iod 7or ! #bdj-;day p]iod1 9 ! case ( ext5sion71 ! f9ancial regulatory ag5cy %all be deem$ to h approv$ ! application4 7,e7 ,additional in=mation ,dur+ ! applicable #abj-;day det]m9ation p]iod 7or ! #bdj-;day p]iod1 9 ! case ( ext5sion71 a f9ancial regulatory ag5cy may reque/ additional in=mation f ! regulat$ entity4 7,f7 ,rule ( con/ruction on fraud & m>ket manipulation au?ority ,no?+ 9 subp>agraph 7,b7 or 7,c7 may be con/ru$ to limit ! au?ority ( a f9ancial regulatory ag5cy to take an en=cem5t action aga9/ a regulat$ entity ) respect to fraud or m>ket manipulation or = engag+ 9 an unsafe or uns\nd practice4 7#h7 ,data security ,all data suppli$ by sponsors ( ,,ai te/ projects to a f9ancial regulatory ag5cy submitt$ "u ?is section %all be /or$ & ma9ta9$ 9 a secure mann] by ! f9ancial regulatory ag5cy1 consi/5t ) applicable data security /&>ds4 7#i7 ,regulations ,n lat] ?an #ahj days aft] ! date ( enactm5t ( ?is ,act1 ea* f9ancial regulatory ag5cy %all promulgate regulations implem5t+ ?is ,act t-- 7,a7 %all be publi%$ 9 ! ,f$]al ,regi/] & provide a #fj-;day p]iod = public notice & comm5t2 & 7,b7 include-- 7i7 proc$ures = submitt+ applications = ,,ai te/ projects & = modify+ ! ,,ai te/ projects t are approv$ by ! ag5cy2 7ii7 consequ5ces = failure to comply ) ! t]ms ( an alt]native compliance /rategy2 7iii7 a requirem5t t an ,,ai te/ project w include a specifi$ t]m9ation date2 7iv7 proc$ures to ext5d ! t]m9ation date describ$ 9 clause 7iii7 = a specifi$ "t p]iod2 7v7 requirem5ts = regulat$ entities to report ! /atus & progress ( ,,ai te/ projects at a frequ5cy reasonably necess>y = c>ry+ out ?is ,act & ! rules promulgat$ !reund]2 7vi7 requirem5ts = regulat$ entities to make disclosures reasonably appropriate to in=m consum]s or inve/ors reg>d+ any direct int]action ) an ,,ai te/ project1 :i* %all be tailor$ to ! scale1 scope1 & risks !re( & describe ! nature ( ! ,,ai te/ project & its applicable alt]native compliance /rategy2 7vii7 proc$ures = ma9ta9+1 z appropriate & consi/5t ) applicable law1 ! confid5tiality1 security1 & privacy ( in=mation2 7viii7 consid]ation ( ! type & capabilities ( propos$ ,,ai te/ projects' relevant ,,ai te*nologies1 sy/ems1 & applications 9 ! developm5t ( applicable guidance & requirem5ts2 7ix7 proc$ures = assign+ appropriate p]sonnel to s]ve z liaisons & po9ts ( contact = regulat$ entities ) approv$ ,,ai te/ projects2 & 7x7 proc$ures = coord9at+ decisions relat+ to applications submitt$ jo9tly by multiple regulat$ entities or applications submitt$ to m ?an "o f9ancial regulatory ag5cy4 7b7 ,int]ag5cy coord9ation & consultation ,! f9ancial regulatory ag5cies %all consult1 %>e in=mation1 & coord9ate1 & may ent] into a jo9t memor&um ( und]/&+1 9 ord] to-- 7#a7 facilitate any jo9t approvals ( applications2 7#b7 und]/& & e/abli% be/ practices ) respect to-- 7,a7 ,,ai innovation ,labs2 7,b7 promulgat+ & updat+ guidance & rules relat$ to f9ancial products1 s]vices1 & activities t make sub/antial use ( artificial intellig5ce bas$ on ! lessons le>n$ f ,,ai te/ projects2 & 7,c7 ,,ai te/ project applications1 approvals1 alt]native compliance me?ods1 conditions1 t]ms1 report+1 disclosures1 ov]sight1 & guidance2 & 7#c7 avoid unnecess>y1 duplicative1 or conflict+ processes or ef=ts ) respect to ,,ai te/ project applications1 approvals1 report+1 & disclosures4 #e4 ,annual report 7a7 ,9 g5]al ,n lat] ?an #b ye>s aft] ! date ( enactm5t ( ?is ,act1 & ea* ye> = #g ye>s !reaft]1 ea* f9ancial regulatory ag5cy %all submit to ! ,committee on ,bank+1 ,h\s+1 & ,urban ,affairs ( ! ,s5ate & ! ,committee on ,f9ancial ,s]vices ( ! ,h\se ( ,repres5tatives an annual report on ! outcomes ( ,,ai te/ projects4 ,a report "u ?is subsection %all include aggregat$ f9d+s1 tr5ds1 & lessons le>n$ f ! ,,ai te/ projects4 7b7 ,confid5tiality ,a report "u ?is section-- 7#a7 may n include ! names ( p>ticipat+ entities or any propriet>y or confid5tial bus9ess in=mation2 & 7#b7 :]e appropriate1 may conta9 a classifi$ annex4 ,june #bd1 #bjbf,report$ ) an am5dm5t1 committ$ to ! ,committee ( ! ,:ole ,h\se on ! ,/ate ( ! ,union1 & ord]$ to be pr9t$