AI View - June 2026

Welcome to AI View, Simmons & Simmons' fortnightly round-up of key AI legislative, regulatory, and policy updates from around the world.

Launch of EU AI Act Transparency Toolkit.

The August 2026 deadline for complying with the EU AI Act’s transparency obligations is fast approaching.

We have launched our EU AI Act Transparency Toolkit, a suite of products designed to help you understand the transparency regime, identify in-scope systems, determine whether you are the provider or deployer and, crucially, implement compliance steps.

More information on the transparency regime and the Toolkit can be found here.

We have also recently hosted a flash webinar, discussing our key takeaways from the draft guidelines on the transparency regime, which you can watch on demand here.

This edition brings you:

1. Illinois adopts AI Safety Measures Act establishing AI governance framework

2. IOSCO issues supervisory toolkit for AI use in capital markets

3. UK ICO publishes response to Government on safe AI powered innovation

4. New York State Unified Court System adopts new rule regarding use of AI

5. California orders review of AI impacts on jobs and workforce transition measures

6. Australia and UK sign MoU to collaborate on AI safety

7. UK FSSC publishes report on AI, technology, skills and the future of work in financial services

1. Illinois adopts AI Safety Measures Act establishing AI governance framework

On 29 May 2026, the Illinois General Assembly adopted the AI Safety Measures Act (SB0315, the Act). The Act introduces a regulatory framework for large frontier AI developers, with a focus on oversight, accountability, and transparency in the development of advanced systems.

The Act requires large frontier developers to appoint an independent third party auditor on an annual basis to assess compliance with the applicable frontier AI framework, being the set of safety and governance requirements applicable to advanced AI systems. The auditor must demonstrate expertise in frontier model safety and carry out the audit in accordance with generally accepted auditing standards.

Developers are required to publish a summary of the audit findings within 30 days of receiving the report. In addition, a redacted copy of the audit report must be submitted to the Illinois Emergency Management Agency and Office of Homeland Security, as well as to the Attorney General.

The Act will take effect on 1 January 2027.

Read the Act here.

2. IOSCO issues supervisory toolkit for AI use in capital markets

On 25 May 2026, the International Organization of Securities Commissions (IOSCO) published its “Supervisory Toolkit for AI Use in Capital Markets” (the Toolkit), providing regulators with practical, non-binding tools to oversee how regulated firms use AI.

The Toolkit is designed to apply across different regulatory models and AI system types, including traditional machine learning, generative AI and emerging agentic AI.
Key provisions of the Toolkit include:

• Lifecycle-based supervision: The toolkit helps supervisors assess AI systems across their development, deployment and ongoing use in capital markets.
• Key supervisory focus areas: The Toolkit highlights risks relating to governance, transparency, third party dependencies and operational resilience as AI adoption expands across investment and operational processes.
• Practical examination tools: The Toolkit includes sample questions and indicators that authorities can use in supervisory dialogue, inspections and reviews of firms’ AI use.
• Monitoring AI adoption: Supervisors are encouraged to use data sources such as surveys, documentation requests, on-site inspections and regular firm engagement to track AI-related risks.
• Global consistency: IOSCO aims to support a common supervisory baseline while leaving room for national frameworks and regulatory approaches.

Read the Toolkit here.

3. UK ICO publishes response to Government on safe AI powered innovation

On 27 May 2026, the UK Information Commissioner’s Office (ICO) published a response to the Technology Secretary and the Business Secretary setting out its plan to support safe AI powered innovation. The response follows a January 2026 request for the ICO to build on its growth commitments and publish a roadmap for enabling responsible AI development.

The ICO’s response outlines progress under its June 2025 AI and biometrics strategy, which is focused on providing regulatory certainty and improving standards in AI, automated decision making, and biometric technologies across both the private and public sectors.

Looking ahead to 2026 to 2027, the ICO confirms that it will prioritise work aimed at strengthening public trust in AI systems and increasing clarity for organisations on how data protection law applies to AI development and deployment.

Key areas of focus include:

• Development of an AI and automated decision-making code of practice to provide greater regulatory clarity.
• Publication of dedicated guidance on agentic AI systems and their compliance with data protection requirements.
• Publication of enhanced transparency tools and resources to assist organisations in carrying out data protection due diligence.
• Streamlining and rebranding the ICO’s innovation and sandbox services to make them easier for organisations developing and deploying AI to access and understand.
• Production of a practical “how to” guide to support individuals in making informed decisions about how their personal data is used by online AI tools and services.
• Listening to public queries and concerns around the increasing personalisation of consumer facing AI services and working with major technology companies to ensure that products meet user expectations in a transparent and privacy focused way.

Further detail on these initiatives will be set out in the ICO’s updated AI strategy, which is expected to be published in the coming months.

Read the response here.

4. New York State Unified Court System adopts new rule regarding use of AI

The New York State Unified Court System has adopted a new rule governing the use of AI in court proceedings. The rule applies across all courts in both civil and criminal cases.

The rule confirms that attorneys and parties may use AI tools when preparing documents submitted to the court, provided they comply with existing legal and professional obligations. There is no requirement to disclose the use of AI in court filings.

Courts may introduce additional rules on AI use. A model rule highlights the need for users to understand the limitations of these tools, including the risk of inaccurate or fabricated content.

Attorneys and parties must carefully review any document prepared using AI and ensure it does not contain fictitious material. Failure to do so may result in sanctions.

Read the new rule here.

5. California orders review of AI impacts on jobs and workforce transition measures

On 21 May 2026, Governor Gavin Newsom signed Executive Order N-6-26 (the Order), directing California to prepare workers, small businesses and communities for potential labour-market disruption caused by AI. The Order focuses on identifying early warning signs, modernising workforce support and ensuring Californians share in the economic gains from AI-driven productivity.
Key areas of focus include:

• Tracking AI’s workforce impact: State agencies must review evidence on AI’s labour-market effects and develop early warning indicators for potential disruption, including impacts on different demographic groups.
• Updating worker protections: California will review possible updates to the Worker Adjustment and Retraining Notification Act, alongside severance, employment insurance, Work Share and other safety-net measures for displaced workers.
• Modernising training and upskilling: The order calls for an AI playbook to support dislocated workers, expand AI literacy and align training programmes with emerging industries and occupations exposed to AI.
• Supporting small businesses and worker ownership: State bodies will explore measures to support technology adoption, workforce retention, and broader participation in the economic gains arising from AI.
• Public-good AI and citizen input: The state will consider ways to incentivise AI deployments that benefit society, including access to compute for public-interest uses, while incorporating feedback from the Engaged California AI consultation.

Read a press release here and access the executive order here.

6. Australia and UK sign MoU to collaborate on AI safety

On 25 May 2026, the UK and Australia announced a new Memorandum of Understanding (the MoU) between the UK AI Security Institute and the Australian AI Safety Institute. The partnership aims to strengthen cooperation on fast moving AI security risks, particularly as frontier AI systems become more capable in cyber related tasks.

Key provisions of the MoU include:

• Frontier AI monitoring: The institutes will share information on the capabilities of advanced AI systems, including how they may be used in cyber-attacks or to strengthen cyber defences.
• Joint evaluation work: The partnership will support collaboration on best practices for testing and evaluating AI systems, helping ensure models behave as intended.
• Research collaboration: Both countries will share research findings on emerging AI risks and work together to inform international approaches to AI security.
• Staff exchanges: The agreement opens the door to exchanges between the two institutes, supporting closer day-to-day cooperation.
• Cybersecurity focus: The announcement follows UK research showing that advanced AI systems are rapidly improving their ability to carry out complex cyber-attacks.

Read the press release here.

7. UK FSSC publishes report on AI, technology, skills and the future of work in financial services

In May 2026, the UK Financial Services Skills Commission (FSSC) published “A Workforce Transformed”, its first report to HM Treasury on how AI and other disruptive technologies are reshaping work in UK financial services. The report finds that AI is becoming a structural, sector-wide force, with firms needing to rethink roles, skills, entry-level pathways and workforce planning.

Key points include:

• AI as a sector-wide shift: AI is no longer limited to discrete technology initiatives and is expected to reshape business models, operations, tasks, roles and skills across financial services.
• Tasks being redesigned: Most job roles could see 30% to 50% of their component tasks automated, although the overall impact will depend on whether firms use AI to drive growth rather than only for efficiency.
• Demand for higher-level skills: AI adoption is expected to increase demand for skills in data, governance, software engineering, interpretation and product design, alongside adaptability, creativity and critical thinking.
• Pressure on entry-level pathways: As lower-skilled tasks become more automated, firms may need to redesign early-career routes to preserve long-term sector expertise and maintain the talent pipeline.
• Execution matters: The report stresses that successful AI adoption depends on strong data, modern systems, governance, leadership, customer confidence and continuous workforce upskilling.

Read the report here.