The Algorithmic Accountability Act of 2025 requires large companies to assess and document the impact of their artificial intelligence and algorithmic systems on consumer decisions in critical areas like employment, housing, credit, healthcare, and education. Companies with at least $5 million in annual revenue that deploy these systems must conduct impact assessments before and after deployment, maintain three years of documentation, and submit annual reports to the Federal Trade Commission, which has two years to establish detailed regulatory rules. The law applies to companies with significant scale—those with over $50 million in revenue, $250 million in equity value, or data on more than one million consumers—and requires them to evaluate how their algorithms perform across different demographic groups while consulting with stakeholders and testing for privacy risks. The FTC will enforce the law through a new Bureau of Technology and maintain a public repository of assessment summaries that consumers can search by company and decision type, while state attorneys general also gain authority to pursue violations on behalf of residents. This legislation aims to increase transparency and accountability in algorithmic decision-making while protecting consumers from potentially discriminatory or harmful automated systems.
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