2023 AI Safety Executive Order Revoked and What Lies Ahead for AI
On President Trump’s first day in office, he rescinded 78 Biden-era Executive Orders via an Executive Order Initial Rescissions of Harmful Executive Orders and Actions (EO 14145). On the list of rescinded Executive Orders is the October 2023 Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence (EO 14110). This recission appears to be based on AI competition between the U.S. and China, where some tech industry actors have expressed concerns that obligations in EO 14110 could stifle U.S. AI innovation.
The Biden Administration’s Final Push for AI
Although EO 14110 has been rescinded, President Biden’s final week in office included several noteworthy actions, pushing forward attempts for federal AI leadership that, at the time of this publication, appear to remain intact.
Executive Order on Advancing Leadership in AI Infrastructure
On January 14, 2025, less than one week before the inauguration of Donald Trump, President Biden signed an Executive Order, Advancing U.S. Leadership in Artificial Intelligence Infrastructure (EO 14141), which attempts to balance U.S. interests in AI development and leadership with the concerns of environmental impacts of data centers.
EO 14141 seeks to enable the development of AI infrastructure, including data centers, in accordance with five principles set forth in the Executive Order for the purposes of enhancing economic competitiveness, leadership, national security, and clean energy in the U.S. EO 14141 directs certain federal agencies to make federal sites managed by such agencies to be leased by non-federal entities for the construction and operation of data centers and clean power facilities by the end of 2027. The EO further sets forth the applicable process, timelines, criteria for site selection, and creates obligations for applicable federal agencies to expedite such development.
EO 14141 also places obligations on developers that construct, own, or operate such AI infrastructure, including the responsibility to procure clean energy resources to match data center needs, as well as to pay all costs related to the data center, so as to not raise electricity prices for consumers. In addition, obligations on developers include the adherence of high labor standards, as well as purchasing an appropriate share of U.S.-manufactured semiconductors to ensure a robust U.S. semiconductor supply chain.
Executive Order on Strengthening and Promoting Innovation in the Nation’s Cybersecurity
On January 16, 2025, President Biden signed an Executive Order on Strengthening and Promoting Innovation in the Nation’s Cybersecurity (EO 14144), which aims to improve the nation’s cybersecurity in the face of foreign cybersecurity threats posed to the U.S. government, private sector, and critical infrastructure networks, which present the most active and persistent threats. Although EO 14144 is not AI-specific, it addresses the ability of AI to improve cyber defense and sets forth obligations for certain federal agencies related to AI, including obligations to accelerate deployment, explore methods of using AI to improve the cybersecurity of critical infrastructure, and accelerate AI and cybersecurity research.
Framework for Artificial Intelligence Diffusion
On January 13, 2025, the Department of Commerce’s Bureau of Industry and Security (BIS) announced a new framework, the Framework for Artificial Intelligence Diffusion, which is intended to secure ecosystems for the responsible diffusion of and use of AI and advanced computing integrated circuits (ICs), with an effort to keep advanced AI models out of the hands of malicious actors, while also ensuring that secure and responsible foreign entities and destinations have access to the same.
There are three parts to this framework, with the most significant being the controls over the exports, reexports, and transfers of ICs. These controls have exceptions for certain U.S. allies and partners, and allow for some exceptions, such as for most supply chain purposes and low volume flows. The framework also updates the Data Center Validated End User (VEU) Program, allowing for authorization for entities in the U.S. and certain allied and partner countries, and the opportunity for entities in other countries (except for arms-embargoed countries) to obtain authorization for building data centers. The second part of the framework involves controls on the model weights of AI models, initially applying to those trained with 10^26 computational operations or more, with restrictions on the trade of such, as well as for certain AI models produced abroad using U.S. technology or equipment, subject to certain exceptions. The third part of the framework involves security conditions involving storage of certain AI models.
What’s Next?
On January 21, 2025, on the second day of his presidency, President Trump announced a $500 billion private sector investment for AI infrastructure by Stargate, a Texas-based joint venture between OpenAI, SoftBank, and Oracle. The announcement was made jointly with OpenAI CEO Sam Altman, Oracle Chairman Larry Ellison, and SoftBank CEO Masayoshi Son. The investment will be a $100 billion initial investment and result in $500 billion over four years, with the goal of advancing AI innovation and creating over 100,000 new jobs.
Although the Stargate project is not new, and construction of a datacenter is reportedly already underway in Abeline, Texas, it appears that the expectation of AI deregulation under the Trump Administration encouraged and enabled the project to move forward with their announcement at this time. The rescission of EO 14110, coupled with the burgeoning alignment of the tech sector with the Trump Administration, appears to signal the tech industry’s expectation of the Administration’s pro-innovation and deregulated stance on AI. Given that seven of the largest AI companies, including Google, Meta, Microsoft, and OpenAI, agreed to voluntary commitments under the Biden Administration, the practical impact those voluntary commitments is unclear.
The question remains whether Congress will take any action. The rescinded EO 14110 presented solutions that had bipartisan Congressional support at one time, such as efforts to improve national security, as well as efforts to bolster the U.S. semiconductor industry.
Whether or not Congress will take action, the state legislatures seem poised to continue their efforts regulating AI. Much like the patchwork emergence of state privacy laws in the last five years, in the absence of federal AI regulation, we expect that state laws regulating AI will continue to emerge. Companies using or developing AI should be aware of existing and emerging state laws regulating AI, as well as applicable sectoral and international laws that may implicate AI or that are AI-specific, including guidance from the Federal Trade Commission, and the EU AI Act. Quarles will continue to monitor updates in the AI space.