California Gov. Gavin Newsom on Sunday vetoed a hotly contested artificial intelligence safety bill after the tech industry raised objections, saying it could drive AI companies from the state and hinder innovation.

Newsom said the bill ¡°does not take into account whether an AI system is deployed in high-risk environments, involves critical decision-making or the use of sensitive data¡± and would apply ¡°stringent standards to even the most basic functions ¡ª so long as a large system deploys it.¡±

Newsom said he had asked leading experts on generative AI to help California ¡°develop workable guardrails¡± that focus ¡°on developing an empirical, science-based trajectory analysis.¡± He also ordered state agencies to expand their assessment of the risks from potential catastrophic events tied to AI use.