Artificial Intelligence (AI) is transforming industries across Latin America, presenting both exciting opportunities and complex challenges for multinational companies. In 2026, the region is witnessing a surge in regulatory activity, operational risks, and new technology-driven business models. While many countries have yet to implement fully harmonized AI laws, current frameworks around privacy, consumer protection, labor, cybersecurity, and intellectual property are already impacting how organizations deploy AI solutions. As companies strive to innovate and expand, understanding these hot topics is essential for staying compliant and competitive.
Regional topics Multinationals Should Monitor Now
Multinational companies operating in Latin America must pay close attention to several overarching themes as the region navigates an evolving landscape of artificial intelligence regulation and enforcement. The following general topics capture the main issues, with country-specific details provided where available:
- Fragmented AI Regulation: No Latin American country currently has a fully mature, harmonized AI regime across all sectors. However, all are moving toward risk-based governance, and existing laws—covering privacy, consumer protection, cybersecurity, constitutional rights, labor, and intellectual property—already apply to AI today. For example, in Brazil, Bill No. 2,338/2023 is pending and proposes a risk-based model with severe penalties for violations, while Chile has updated its National AI Policy and introduced a risk-based bill inspired by international frameworks. Mexico instead included a new opt-out requirement for automated decision making in its latest data protection law and the Mexican Congress is pushing hard to enact an amendment to the labor and copyright laws to regulate the use of image rights and AI to ease pressing requests from artists and performers. Regarding Argentina, there are several bills of law currently introduced in Congress. For example, a key development is Bill No. 4243-D-2025 which aims to establish a regulatory framework for personal data processing in AI systems. The bill defines core concepts, applies territorial and extraterritorial scope, and introduces transparency obligations, risk assessment protocols, and classification criteria. It empowers authorities to audit, sanction, and suspend operations, and proposes a National Registry for medium and high-risk AI systems.
- Current Legal Frameworks Already Shape AI Compliance: Even where AI-specific laws are still pending, companies face exposure through data protection, personality rights, consumer and labor laws, cyber rules, copyright, and criminal law. This is particularly relevant in HR, finance, healthcare, education, digital platforms, and public-facing AI tools. Argentina, for instance, relies on a patchwork of administrative measures and labor-law principles, with courts already sanctioning irresponsible AI use.
- Deepfakes, Synthetic Media, and Identity Fraud: These are rapidly becoming enforcement priorities. Chile, Argentina and Colombia have advanced deepfake-oriented proposals or laws, while Venezuela’s information environment and ethical initiatives make provenance, labeling, and rapid takedown processes essential for platforms and brand owners.
- Employment AI Is High-Risk Across the Region: AI used in recruitment, performance scoring, workplace monitoring, productivity management, compensation, and termination can trigger privacy, discrimination, due process, explainability, and labor litigation issues. Pending bills in Brazil and Colombia treat employment-related AI uses as high-risk or highly sensitive. Argentina’s employment law limits AI-driven management to reasonable and dignified practices, with unions already discussing its impact in collective bargaining. Mexico included in the latest data protection law an opt-out right for automated processing of personal data resulting on harm for the data subject.
- AI Governance Is No Longer Optional: Regulators expect companies to implement risk classification, impact assessments, internal controls, human oversight, incident response, transparency notices, documentation, and auditability. Companies should not wait for final statutes to put these controls in place.
- Cross-Border Data Transfers and Localization: Many AI deployments involve centralized data across borders, raising issues around transfer, privacy, territorial scope, regulatory reach, and control over sensitive or regulated data. In the case of Chile’s new Personal Data Protection Law will be highly relevant for AI systems using profiling, biometrics, or automated decisions.
- Vendor and Procurement Risk: Companies increasingly rely on model providers, cloud vendors, synthetic-media vendors, HR-tech providers, and data suppliers. Contractual protections around training-data provenance, IP rights, confidentiality, security incidents, explainability, audit rights, and data reuse are now essential.
- AI Incident Response and Governance Committees: The rise of deepfake abuse, prompt leakage, hallucinated outputs, cyber incidents, unfair outcomes, and regulator queries is prompting companies to adopt cross-functional governance structures with clear escalation, oversight, documentation, and remediation processes.
- Competition, Unfair Commercial Practices, and Pricing Algorithms: Authorities and commentators are increasingly focused on how AI-driven pricing, ranking, and optimization tools may facilitate collusion, distort markets, or generate misleading, opaque, or discriminatory outcomes for consumers.
- Board Oversight, Disclosure Readiness, and Regulated-Sector Accountability: As AI risk moves into enterprise governance, listed entities, financial institutions, healthcare providers, telecom operators, and infrastructure businesses should expect AI governance to be reviewed through internal controls, auditability, sector supervision, and senior-management accountability. For example, Brazil is moving toward sectoral regulators playing a central role, layering compliance on top of future AI statutes.
AI is no longer just a future concern for Latin American companies—it is a present reality shaping legal, operational, and reputational strategies. The region’s experts offer deep knowledge of both current and emerging frameworks, helping clients address compliance, innovation, and risk management with confidence. By partnering with seasoned professionals who understand the intricacies of local and regional AI trends, businesses can capture the value of AI responsibly and stay ahead in a fast-moving market.
*Trench Rossi Watanabe and Baker McKenzie have executed a strategic cooperation agreement for consulting on foreign law.
