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AI Regulation Moratorium Idea Isn't Dead as Ted Cruz Pushes Sandbox Act

The SANDBOX Act allows AI companies to seek two-year waivers from federal regulations to foster innovation while maintaining accountability, with oversight by the Office of Science and Technology Policy.

  • On Wednesday, Senator Ted Cruz introduced the SANDBOX Act, allowing AI developers to request two-year waivers or modifications to obstructive regulations under written agreements to mitigate risks.
  • Earlier this year, Senator Ted Cruz's sandbox proposal builds on efforts to limit state regulations after a moratorium failed 99-1, while the White House AI Action Plan urged creating such sandboxes to boost U.S. competitiveness with China.
  • Under the bill's terms, applicants would ask the OSTP Director for two-year waivers, federal agencies would have 90 days to object, and the Office of Management and Budget holds veto power over denials.
  • OSTP Director Michael Kratsios welcomed the idea and voiced support, while Democrats and consumer groups warned the bill could invite abuse and Public Citizen called it a potential 'get-out-of-jail-free card'.
  • Analysts warn the approach might favor Big Tech and set a deregulatory precedent influencing international AI governance, while the U.S. administration's push for lighter AI rules raises equity concerns for startups and under-resourced firms.
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The Register broke the news in on Wednesday, September 10, 2025.
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