US Implements New Restrictions on AI Technology Exports to China

The Biden administration has introduced a controversial export control policy aimed at curbing advanced technology transfers, specifically chips and artificial intelligence models, to countries deemed potential adversaries like China. The new "AI Diffusion rule" delineates a list of allied countries with relatively free access to these technologies, while others, including China, face stringent licensing requirements.

Managed by the Commerce Department's Bureau of Industry and Security, this rule is the first to specifically limit the dissemination of leading AI models. "The US leads the world in AI now, both in AI development and AI chip design, and it's critical that we keep it that way," commented US Commerce Secretary Gina Raimondo during the announcement.

The policy lists trusted nations such as the UK, Canada, Australia, Japan, and several European countries that can access US AI technologies more freely. Other nations can acquire up to 1,700 AI chips without a special permit, but must apply for licenses to obtain more, especially for building large-scale data centers or acquiring US-made AI model "weights." Companies must demonstrate comprehensive physical and cybersecurity measures to secure a license.

Exempt from the rule are certain supply chain actions like chip design and manufacturing, and it also does not affect open-source AI models such as Meta's Llama. Arms embargoed countries like China, Iran, and North Korea face augmented restrictions specifically targeting their access to advanced AI models for the first time.

"Semiconductors and model weights are dual-use technologies," Raimondo noted. "They're essential for commercial purposes but can also enable adversaries to conduct nuclear simulations, develop bioweapons, or enhance military capabilities." Despite its intentions, the rule has generated debate, as it might impede international AI sales during a critical period for the industry, emerging just prior to Trump's inauguration.

Nvidia, a leading AI chip manufacturer, criticized the rule as "unprecedented and misguided" in a blog post, suggesting the rules fail to bolster US security but rather undermine its competitive edge and innovation in AI technology globally.

Existing US limitations already restrict AI chip exports to China, yet Chinese firms have managed to create advanced algorithms using international data clusters. Under the new directive, China will find it challenging to develop frontier AI models in nations where the rule is applicable.