WASHINGTON — The Biden administration has introduced a new framework for the export of advanced computer chips essential for artificial intelligence (AI) development. This initiative aims to balance the need for national security regarding the technology with the economic needs of manufacturers and international stakeholders.
However, the newly proposed framework has sparked concerns among chip industry leaders, who argue that the regulations will restrict access to existing chips, particularly those used in video gaming. Additionally, the new rules could limit the availability of chips necessary for data centers and AI products in as many as 120 countries, including Mexico, Portugal, Israel, and Switzerland.
Commerce Secretary Gina Raimondo emphasized the importance of maintaining the U.S.’s leadership position in AI technology and the accompanying computer chips. The rapidly developing AI capabilities empower computers to produce literature, achieve breakthroughs in scientific research, drive vehicles autonomously, and instigate numerous changes that could alter both economies and military dynamics.
Raimondo mentioned that as AI’s capabilities grow, the potential risks to national security also increase. The proposed framework aims to protect the most sophisticated AI technologies and prevent them from being accessed by foreign adversaries while promoting the benefits of AI among allied nations.
Jake Sullivan, the national security adviser at the White House, reiterated that the framework is designed to ensure that the most innovative versions of AI technology continue to be developed within the U.S. and in collaboration with its closest allies, avoiding scenarios where crucial technology is offshored, similar to the situation seen in the battery and renewable energy sectors.
The Information Technology Industry Council, representing tech companies, alerted Raimondo in a recent letter about the risks of hastily implemented rules, suggesting they could disrupt global supply chains and disadvantage American firms. Similarly, the Semiconductor Industry Association expressed disappointment at the speed with which the policy was being introduced before a potential leadership change. John Neuffer, the President and CEO of SIA, stated that such measures risk weakening America’s economy and global stance regarding semiconductors and AI by giving competitors access to vital markets.
One executive from the chip industry, who spoke on the condition of anonymity, indicated that the proposed rules would inhibit access to chips used in video games, contradicting government assertions. This executive also pointed out that restrictions could limit the companies eligible to establish data centers internationally.
With a 120-day comment period included in the framework, it’s possible that the incoming Republican administration, led by President-elect Donald Trump, may influence the final export regulations surrounding advanced computer chips. This situation presents a challenge for Trump as he needs to find a balance between economic interests and national safety requirements.
Officials noted their urgency in implementing these rules to maintain what is viewed as a six- to eighteen-month lead that the U.S. has over competitors like China in the realm of AI—a lead that could diminish if adversaries manage to stockpile relevant technology.
Ned Finkle, Nvidia’s vice president of external affairs, explained that while the previous Trump administration laid essential groundwork for AI’s advancement, the new framework could stifle innovation without fulfilling intended security objectives. He criticized the rules, labeling them as ineffective under the pretext of being “anti-China”, asserting that they wouldn’t bolster U.S. national security and could create global technology controls.
According to the White House’s fact sheet, the framework allows approximately 20 key allied nations to access chips without facing restrictions. Countries including Australia, Germany, Japan, and the United Kingdom are among those without limitations.
For nations outside of this close-knit group, there is a cap whereby they can purchase up to 50,000 graphics processing units per country. Government-to-government agreements may expand this cap to 100,000 if those countries align with U.S. renewable and technological security aims.
Furthermore, institutions in select countries could apply for a status that would enable them to acquire as many as 320,000 advanced graphics processing units over two years, though their AI computational capacity abroad will still be constrained. Orders for up to 1,700 advanced GPUs will not require a license to import, thereby allowing smoother transactions, particularly benefiting universities and medical organizations.
Notably, the new guidelines should not impede the growth plans of leading cloud computing services, such as Amazon, Google, and Microsoft, as these companies will be exempted from certain regulations when seeking significant access to advanced AI chips. Brad Smith, President of Microsoft, expressed confidence on behalf of the company, reassuring compliance with high-security standards and fulfilling the technological requirements of various countries globally.
Microsoft faced bipartisan criticism after announcing a substantial investment in a technology company from the United Arab Emirates, which is closely watched due to its connections with national security officials. G42 operates data centers and is recognized for developing a leading Arabic-language AI model, raising concerns among U.S. lawmakers about the potential transfer of critical technology to China, prompting calls for enhanced national security measures.
