US clamps down on AI chip export drawing pushback
2025-01-14
Category: economic

The US is moving to impose tough new restrictions on the export of advanced computer chips and other artificial intelligence (AI) technology to dozens of countries - not just the handful it has long identified as adversaries.Officials say the new rules are intended to make sure the "the world's AI runs on American rails" and keep it out of the hands of "malicious actors" who could use it to threaten the United States.The Biden administration said 18 allies and partners, including the UK, were exempt from the restrictions.The announcement, days before President Joe Biden is due to leave office, has  drawn fierce criticism from some top US tech companies who warn it will only aid competitors.
"In the wrong hands, powerful AI systems have the potential to exacerbate significant national security risks, including by enabling the development of weapons of mass destruction, supporting powerful offensive cyber operations, and aiding human rights abuses, such as mass surveillance," the US Commerce Department said on Monday.Chip-maker Nvidia - among the companies whose business would be most affected by the plan - said if implemented, it would not "mitigate any threat" but only "weaken America's global competitiveness" and undermine its innovation."By attempting to rig market outcomes and stifle competition—the lifeblood of innovation—the Biden Administration's new rule threatens to squander America's hard-won technological advantage," the company said.The new restrictions face a 120-day comment period before going into effect.
Exports to countries such as China, Russia and Iran already face strict controls. The new rules set caps for exports of certain technology to most countries around the world and require US companies to get authorisation for sales there. Washington's closest allies would be exempt from the limits.Orders under a certain level of computing power also would not require a license or count toward the caps under the plan. Most orders, such as those from universities or medical organisations, fall under that threshold of 1,700 advanced GPUs, the Biden administration said. The rules also outline a process for foreign governments to sign agreements, in exchange for looser restrictions. 
Biden administration officials said they had discussed the regulations with the incoming administration.But Jonathan Kewley, co-head of the tech group at the Clifford Chance law firm,  said he did not think the rules would survive once Trump enters office, noting that one of Trump's key campaign promises was to change the government's approach to AI regulation.  "It is absolutely sure that the Trump administration will wind back a lot of what Biden has put out there," he said. "There's going to be a big play for innovation and growth in the US and a drawback from the approach to AI regulation."The Information Technology and Innovation Foundation, a tech policy thinktank, said it thought the US would be better served by a strategy focused on competition, instead of "containment"."By pressuring other nations to choose between the United States and China, the administration risks alienating key partners and inadvertently strengthening China's position in the global AI ecosystem," vice president Daniel Castro said. "Confronted with such an ultimatum, many countries may opt for the side offering them uninterrupted access to the AI technologies vital for their economic growth and digital futures".