FTC Chair Warns Artificial Intelligence Industry of Vigorous Enforcement

WASHINGTON, October 2, 2023 – The chair of the Federal Trade Commission warned the artificial intelligence industry Wednesday that the agency is prepared to clamp down on any monopolistic practices, as she proposed more simplistic rules to avoid confrontation.

“We’re really firing on all cylinders to make sure that we’re meeting the moment and the enormous and urgent need for robust and vigorous enforcement,” Lina Khan said at the AI and Tech Summit hosted by Politico on Wednesday.

Khan emphasized that the FTC’s statute on consumer protection “prohibits unfair deceptive practices” and that provision extends to AI development.

The comments come as artificial intelligence products advance at a brisk pace. The advent of new chat bots – such as those from OpenAI and Google that are driven by the latest advances in large language models – has meant individuals can use AI to create content from basic text prompts.

Khan stated that working with Congress to administer “more simplicity in rules” to all businesses and market participants could promote a more equal playing field for competitors.

“It’s no secret that there are defendants that are pushing certain arguments about the FTC’s authority,” Khan said. “Historically we’ve seen that the rules that are most successful oftentimes are ones that are clear and that are simple and so a regime where you have bright line rules about what practices are permitted, what practices are prohibited, I think could provide a lot more clarity and also be much more administrable.”

Khan’s comments came the day before the agency and 17 states filed an antitrust lawsuit against Amazon, which is accusing the e-commerce giant of utilizing anticompetitive practices and unfair strategies to sustain its supremacy in the space.

“Obviously we don’t take on these cases lightly,” Khan said. “They are very resource intensive for us and so we think it’s a worthwhile use of those resources given just the significance of this market, the significance of online commerce, and the degree to which the public is being harmed and being deprived of the benefits of competition.”

Since being sworn in 2021, Khan’s FTC has filed antitrust lawsuits against tech giants Meta, Microsoft, and X, formerly known as Twitter.