China Advances AI Legislation With Risk Reporting and Regulatory Sandboxes

China's National Development and Reform Commission is accelerating work on comprehensive AI legislation that would push developers and operators to disclose safety risks and report incidents and vulnerabilities, alongside industry testing sandboxes.

The planned framework would set safety standards and ethical rules across AI’s lifecycle, spanning data, computing power, algorithms and applications from research and development through deployment. It would include a transition period for companies and sandbox procedures for applications, testing, use and exit. Regulators would periodically review the rules and adjust them.

The proposed oversight would also address AI’s effects on people. Authorities plan to monitor the risk of AI replacing jobs, strengthen social protections and address users becoming overly reliant on AI or developing emotional dependence. Deepfakes, algorithmic discrimination and privacy leaks are also within the stated governance scope.

China adopted measures governing public-facing generative AI services in 2023, and comprehensive AI legislation was added to the State Council’s work plan in May. Sandbox programs have already been explored in some AI service areas.