AI-Generated Ads: Pennsylvania’s New Law Brings Tougher Disclosure Rules

Under the Artificial Intelligence Deceptive Advertising Act, advertisers must disclose when covered synthetic content has been modified or generated using artificial intelligence. The disclosure must be clear and conspicuous, appear when the content is first presented to consumers, and use the same medium as the synthetic content. Where technically feasible, the disclosure must also be permanent or extraordinarily difficult to remove.

This means covered AI-generated ads cannot necessarily rely on a disclosure hidden in a separate webpage or an unrelated section of an advertiser’s website. The notice needs to accompany the synthetic material in a way consumers can reasonably see or hear.

For example, a qualifying video advertisement may need a visible notice, while an advertisement using synthetic audio may need an appropriate disclosure in the audio medium. The precise implementation will depend on the format and circumstances.

The law also reaches beyond digitally created people or virtual spokespersons. It addresses synthetic content in images, video, and audio, potentially affecting businesses that use AI to produce product visuals, demonstrations, endorsements, or other promotional material.

Nevertheless, the statutory language is important: the requirement is tied to creating a false consumer perception about the advertised goods or services. Not every use of AI in marketing automatically meets that standard.

Which AI-Generated Ads Could Be Affected?

The legislation could have practical implications for companies using AI to create realistic representations of products or services. An advertiser might use generative AI to alter the appearance of a product, create a synthetic demonstration, or produce an endorsement that gives consumers a misleading impression of what is being sold.

In such circumstances, AI-generated ads may require a disclosure if the content falls within the law’s scope. A digitally altered image that makes a product appear materially different from reality, for example, could raise questions about whether consumers are being misled.

The same issue can arise with synthetic audio or video. If AI-generated material misrepresents the authenticity or origin of an advertised product or service, advertisers should carefully assess whether the law applies.

However, there is still room for interpretation. Legal analysis published by Loeb & Loeb highlights uncertainty around what qualifies as a false consumer perception. The legislation’s wording may leave advertisers with questions about whether the use of synthetic content itself triggers a disclosure or whether the content must create an additional misleading impression.

Businesses should therefore avoid assuming that every AI-generated image is automatically covered—or that an apparently harmless creative edit is automatically exempt.

Companies should pay particular attention to AI-generated ads featuring realistic product demonstrations, synthetic endorsements, or altered representations of goods and services. Although AI-generated ads can offer creative flexibility, that flexibility should not come at the expense of consumer understanding. Before releasing AI-generated ads, advertisers should review the overall impression created by the content, not just whether individual images or statements are technically accurate. Where the legal position is unclear, businesses should seek appropriate legal advice before distributing AI-generated ads.

Exceptions and Questions About Enforcement

The law contains exceptions, including content that is evidently fictional and material used for parody, satire, commentary, or criticism. It also exempts content limited to text. These exceptions mean the rules do not apply identically to every form of AI-generated material.

The boundaries of some exceptions may still be difficult to interpret in practice. Advertisers will need to consider the context, purpose, and likely effect of their content rather than relying on a single universal rule for all AI-generated ads.

Enforcement is assigned to Pennsylvania’s attorney general and district attorneys. According to the legal analysis from Loeb & Loeb, courts may impose civil fines of up to $3,000, in addition to attorney fees and costs, under the law’s enforcement provisions. The legislation does not create a private right of action.

A disclosure also does not automatically make a misleading advertisement lawful. Businesses remain subject to other applicable consumer-protection and advertising rules. Adding an AI label should not be treated as permission to make false claims about a product.

What Businesses and Marketing Teams Should Do Now

Companies advertising in Pennsylvania should review how they use generative AI throughout their marketing workflows. That review should include content created internally, material supplied by agencies, and promotional assets provided by third-party vendors.

Businesses should identify which advertisements contain AI-generated or significantly modified images, audio, or video. They should then assess whether the content could create a false perception about the nature, origin, or authenticity of the goods or services being advertised.

For covered material, organisations should establish a consistent disclosure process. Marketing teams can develop approved notice formats, ensure disclosures appear in the relevant medium, and document how decisions are made. Agencies should also clarify responsibilities with clients so that disclosure requirements are not overlooked during campaign production.

Companies should pay particular attention to advertisements distributed across multiple channels. A synthetic video may be reused on a website, social media platform, connected television service, and digital advertising network. Each placement should be reviewed to ensure the required disclosure remains clear and visible or audible.

Businesses seeking to improve their broader digital risk management can also review Progressive Robot’s cybersecurity services and IT security services.

A written review process can help companies manage AI-generated ads across websites, social platforms, and paid campaigns. Marketing teams should record which assets contain synthetic elements, assess whether AI-generated ads could create a false impression, and confirm that required notices remain visible or audible in each format. Agencies and clients should also agree on who approves AI-generated ads and who is responsible for adding disclosures before campaigns go live.

A Wider Shift Toward AI Advertising Transparency

Pennsylvania’s law reflects a broader policy debate about how advertising rules should respond to increasingly realistic synthetic media. Governments are exploring different approaches, including disclosures for synthetic performers and requirements aimed at misleading product promotions.

The approaches are not identical. Some rules focus on whether a digitally generated person appears in an advertisement, while Pennsylvania’s law addresses synthetic content used in a way that creates a false perception about advertised goods or services.

For companies operating across state lines, these differences can complicate compliance. A campaign that meets one jurisdiction’s requirements may need additional review before it is distributed elsewhere. Businesses may therefore choose to adopt consistent disclosure procedures across their campaigns, while still checking the specific legal requirements that apply in each market.

The development of AI-generated ads is unlikely to slow simply because new regulations are introduced. Generative tools offer advertisers faster production and more flexible creative options. The challenge is ensuring that those capabilities do not undermine consumers’ ability to make informed decisions.

As regulations evolve, companies may need to review their AI-generated ads more frequently and adapt internal policies to different jurisdictions. A consistent compliance workflow can make it easier to identify AI-generated ads that need additional review while allowing routine creative work to continue. Clear disclosures, accurate product representations, and documented approval procedures can help businesses use AI-generated ads responsibly and preserve consumer trust.

The Bottom Line

Pennsylvania’s Artificial Intelligence Deceptive Advertising Act introduces new disclosure obligations for covered synthetic advertising content, with the law scheduled to take effect on December 21, 2026.

For businesses, the immediate priority is to review AI-assisted marketing, understand the law’s scope and exceptions, and establish clear procedures for disclosing synthetic content when required. Because some of the wording remains open to interpretation, advertisers should follow authoritative guidance and seek legal advice when assessing borderline cases.

As AI-generated ads become more realistic and widely used, transparent advertising practices will be increasingly important for maintaining consumer trust and reducing legal risk.