US tightens control on AI chips export drawing pushback

The United States is planning to implement new strict restrictions on the export of advanced computer chips and other artificial intelligence (AI) technologies, targeting not only a few countries long considered adversaries but also dozens of others. Officials stated that the new regulations aim to ensure that "global AI runs on America's track" and prevent it from falling into the hands of "malicious actors" who might use the technology to threaten the U.S.

The Biden administration announced that 18 allies and partners, including the UK, would be exempt from these restrictions. However, this announcement, made just days before President Joe Biden's departure, has drawn criticism from the European Union and some of America's top tech companies, who warn that it will only help competitors. The U.S. Commerce Department stated on Monday: "In the wrong hands, powerful AI systems have the potential to exacerbate significant national security risks, including supporting the development of weapons of mass destruction, enabling powerful offensive cyber operations, and fueling human rights abuses such as mass surveillance."

Chipmaker Nvidia, one of the companies most affected by the plan, said that if implemented, it would not "mitigate any threats" but would only "weaken U.S. global competitiveness" and undermine its innovation capabilities. The company stated: "By attempting to manipulate market outcomes and stifle competition—the source of innovation—the Biden administration's new rules threaten to squander America's hard-won technological advantage." The new restrictions have a 120-day comment period before taking effect. Currently, exports to countries such as China, Russia, and Iran already face strict controls.

The new regulations set caps on exports of certain technologies to most countries in the world and require U.S. companies to obtain authorization when making sales in those countries. Washington's closest allies will be exempt from these restrictions. Under the plan, orders below a certain computing power threshold will also not require licenses or count toward the caps. The Biden administration stated that most orders, such as those from universities or medical institutions, are below the threshold of 1,700 advanced GPUs. The rules also outline a process for foreign governments to sign agreements in exchange for more relaxed restrictions.

EU officials have expressed concern about the impact on some member states and their companies, stating that they believe it is also in the U.S.'s interest that the EU's purchase of advanced AI chips from the U.S. remain "unrestricted." EU trade and technology chiefs said in a joint statement: "We have expressed our concerns to the current U.S. administration, and we look forward to a constructive dialogue with the next U.S. administration." Biden administration officials have stated that they have discussed the regulations with the incoming administration. However, Jonathan Kelly, co-head of the technology group at Clifford Chance law firm, said he believes these rules will not hold once Trump takes office, noting that one of Trump's key campaign promises is to change the government's approach to AI regulation.

Kelly said: "The Trump administration will certainly undo most of what Biden has put in place. The U.S. will be strongly pushing innovation and growth and stepping back from the way AI is regulated." The Information Technology and Innovation Foundation, a tech policy think tank, stated that it believes the U.S. would be better off adopting a competition-focused strategy rather than "containment." The foundation's vice president, Daniel Castro, stated: "By forcing other countries to choose between the U.S. and China, the administration risks alienating key partners and inadvertently strengthening China’s position in the global AI ecosystem." He added, "Faced with such an ultimatum, many countries may choose to support those that offer them uninterrupted access to AI technologies critical for their economic growth and digital future."