An annual industry fee will fund Ofcom’s costs of regulation under the Online Safety Act. This will provide Ofcom with adequate resources to effectively exercise their online safety functions, including responding to developing challenges such as the growing use of AI. of AI where that use is in scope of the Online Safety Act. The Act regulates AI generated content where it constitutes illegal content or content which is harmful to children and is either user-generated content on an in-scope service or is discoverable within a click of search results. Ofcom will also have robust enforcement powers to issue substantial fines, implement business disruption measures, or even initiate prosecutions against senior managers in exceptional circumstances. The growing use of AI models and tools by criminals to produce illegal content (e.g. child sexual abuse material) or content that is used to facilitate crime (e.g. fraud) is a genuine concern. There are also risks that the prevalence of this offending gets worse and expands to other areas of the criminal justice system such as the creation of false alibis and evidence. The Government is investing in deepfake detection capability, looking closely at the applicability of the criminal law to AI-enabled offending and investing in policing skills and training. The Government is also looking at measures which might restrict the ability for AI tools to be used by criminals. Government response to Committee recommendations 52 and 53