Proposed AI Rules
Could Reshape
The U.S. General Services Administration’s draft clause raises questions about software, data ownership, commercial agreements, and compliance for distributors working with the federal government.
Government Contracts T
here’s no getting away from artifi cial intelligence in today’s distribution operations. From
By Ethan Gibble Contributing Writer
36 FEDA News & Views
productivity software and inventory management platforms to e-commerce automation, distributors are deploying AI to connect their data and expand their customer reach. Even the foodservice equipment itself is tapping into AI for features like predictive maintenance and optimized cooking times. The amount of proprietary information now fl owing between AI-powered systems is endless, but like anything, that innovation and convenience comes with a downside. For the federal government, the chief concern is the security of that data. If a malicious actor were to access an equipment distributor’s customer relationship management (CRM) system or quoting solution, for example, they could conceivably use it to distribute malware to government buyers that granted them access to sensitive information. It’s a scenario not unlike the 2020 cyberattack that breached a dozen government departments, including the U.S. Treasury and the
Justice Department. Over the course of several months, the attackers modifi ed a technology provider’s network monitoring software to install backdoors into government offi cials’ emails and confi dential documents. The ability for AI systems to act without human intervention only heightens those security risks. Federal policymakers are responding by regulating not only AI developers, but even businesses that use AI tools to complete government contracts. In March, the U.S. General Services Administration (GSA) published a draft contract clause aimed at safeguarding government data within large language model (LLM) AI systems. While the goal of ensuring secure and trustworthy AI for the federal government is an important one, the execution outlined in the GSA Acquisition Regulation (GSAR) clause has raised concerns that extend well beyond AI.
Compounding the issue is the
GSA’s infl uence across all government operations. The organization administers the Multiple Award Schedule, a contracting program that
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