New York's AI Advertising Law: What Brands and Agencies Must Disclose

By Andrew R. Jacobs, Esq. | Founder & Managing Attorney, Jacobs Counsel LLC | Director, Sports, Entertainment & Gaming Initiatives, Seton Hall University School of Law | Super Lawyers Rising Star 2026

An agency can now create a spokesperson who looks human without hiring a human performer. Before that asset goes into a New York campaign, the brand and agency need to resolve disclosure, permissions and responsibility for the final advertisement.

New York's synthetic-performer disclosure requirement took effect June 9, 2026, according to the Governor's announcement. This guide uses the current statutory text, including its exceptions, to help brands, agencies and creators prepare a campaign review.

What does New York's AI advertising law cover?

General Business Law § 396-b addresses people and businesses dealing in property or services who produce or create a commercial advertisement. When they have actual knowledge that the ad contains a synthetic performer, the statute requires a conspicuous disclosure in the advertisement.

The definition focuses on a digitally created or modified asset that appears to be a human performer but is not recognizable as an identifiable real performer. The current definition addresses visual and audiovisual performances. It is not a blanket rule requiring every use of AI in an advertising workflow to be labeled.

Start with the asset itself and the parties' roles. An invented human-looking spokesperson, a recognizable person's digital replica, AI-assisted color correction and a translated performance raise different questions. A vendor's description of all four as AI content is not a legal classification.

Which advertisements and exceptions need closer review?

The table summarizes issues under the current section, not a clearance decision for a particular campaign. The law also preserves other rights and existing Section 230 protections. Review the actual workflow and distribution before relying on an exception.

Where should the disclosure appear?

The statute requires disclosure in the advertisement and makes conspicuousness the standard. It does not prescribe a universal font size or a single required sentence. A notice in an agency agreement or on an unrelated policy page does not answer whether the advertisement itself satisfies that standard.

As a practical review, inspect each final version at its actual display size: vertical video, a cropped social ad, a still image and a placement with platform overlays. Check whether the audience can notice and understand the disclosure. Recheck after editing or resizing; approval of a master file should not silently cover a materially different version.

Section 396-b provides a $1,000 civil penalty for a first violation of the synthetic-performer disclosure requirement and $5,000 for a subsequent violation. Those amounts do not define the full exposure from separate rights, contract or deceptive-advertising issues.

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An AI disclosure does not replace consent or endorsement review

New York's disclosure statute expressly preserves rights under the Civil Rights Law. Civil Rights Law § 50 separately addresses using a living person's name, portrait, picture, likeness or voice for advertising or trade without written consent. For a recognizable person, review the actual permission and applicable law instead of assuming an AI label supplies consent.

Ask whether a creator's agreement allows the proposed edits, paid distribution, duration, sublicensing and digital reuse. A license for one sponsored video may not authorize generating new performances or reusing the creator's identity in later campaigns. Our content licensing guide explains the broader rights to examine.

Endorsements raise another question: what will consumers understand about the speaker, their experience and any brand relationship? The FTC's endorsement guidance addresses truthful endorsements and material connections. Labeling a character as AI does not establish that a product claim is supported or that a separate sponsorship disclosure is adequate.

Six contract decisions for brands, agencies and creators

• Describe the permitted asset. Identify whether the project uses a synthetic performer, a real person's recording, licensed content or a combination. Require disclosure of material changes in production.
• Allocate approvals. Name who reviews the generated asset, the claims, permissions and disclosures, and which edits require a new approval.
• Define the rights. Address paid media, platforms, territory, duration, edits, sublicensing, digital replicas and any proposed model-training use separately.
• Assign disclosure delivery. Specify who places the disclosure in each format and who checks the version actually distributed.
• Require useful records. Identify the licenses, consents, vendor terms, creative versions and approval records each party must retain and provide.
• Plan correction and allocation of risk. Address suspension, replacement creative, removal, claims cooperation, indemnities and insurance with the actual responsibilities in mind.

These are proposed contract-review topics, not additional clauses mandated by § 396-b. Allocating a task in an agreement also does not remove a party's own legal obligations.

A campaign checklist before launch

Put the final advertisement, every distribution format, the media plan, creator releases, agency agreement and relevant AI-vendor terms in one review set. Identify the people who produced the asset, approved it and will place it. Flag any missing permission or uncertainty about whether the asset depicts an identifiable person.

Use one hypothetical failure test: if the platform crops out the disclosure or an agency supplies an unapproved replacement face, who can stop the campaign, obtain the source files and approve a correction? Resolve that before the launch date becomes a reason to skip review.

Questions about New York's AI advertising law

Does every AI-assisted advertisement need a synthetic-performer disclosure?

No. The current rule turns on the statutory definition, the creator or producer's role and actual knowledge, and the applicable exceptions. Using AI for an unrelated production task does not by itself settle the disclosure question.

Can we put the disclosure only in the brand's website terms?

The statute calls for a conspicuous disclosure in the advertisement. A notice located only in separate website terms does not satisfy that placement requirement.

Does an AI label let us use a celebrity's or creator's likeness?

No. Disclosure and permission are separate issues. Review the applicable likeness rights and the actual agreement authorizing the use, including digital alterations and later reuse.

Can the agency take care of the entire review?

An agency can perform agreed tasks, but the brand should confirm who owns approvals, permissions, final-version checks and corrections. A contract does not automatically eliminate either party's legal obligations.

Review the advertisement and the agreements together

Jacobs Counsel can help review campaign assets, content rights and commercial agreements, subject to conflicts and an agreed engagement. Explore brand and IP services, see creator rights and brand-deal support, or discuss your campaign. Bring the actual creative and contracts so the review can focus on the decisions before launch.

Sources checked September 21, 2026. General information, not legal advice. Requirements depend on the campaign, the parties' roles and the applicable law.

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