The Biden administration is further tightening export restrictions around AI chips and software toward hostile states (read as: China). The chip industry is not happy with the proposed rules.
Joe Biden may be entering his final days as president, but he is not bottoming out just yet. In a press release, the White House announced renewed measures around the regulation of AI technology. The proposed package of measures includes a licensing system that more strictly delineates who can and especially who cannot participate in artificial intelligence of the United States.
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Specifically, the proposal divides the world into three categories. In category is the domestic market and a select club of 18 political allies or countries that meet U.S. security standards. No export restrictions apply to this category. Suppliers of AI technology do not need to apply for a license to sell in these markets. Smaller chip orders, such as those from universities and research institutions, are processed more quickly without a licensing requirement.
Approved user
In addition, a “verified user” status is being introduced for trusted companies in allied countries. They will be allowed to deploy up to 7 percent of their global AI computing power in other countries. Similar status applies to companies in other non-aligned countries, allowing them to purchase significant amounts of advanced chips.
Governments that join a new U.S. framework for AI exports and security can even double their import quotas. These arrangements promote international cooperation around AI development and technology security.
Countries of concern
For countries in categories two and three, the policy is much less generous. Category two includes countries that the United States does not consider a friend, but also does not have a hostile relationship with. These are subject to an export restriction of up to 50,000 advanced GPUs.
In the third category you would rather not end up. These are the countries that the U.S. labels as “countries of concern. Names are not mentioned, where those who follow geopolitics closely will know that these are countries such as China, North Korea, Iran and Russia.
Regulations impose strict restrictions on countries considered at risk. Advanced semiconductors may not be used there to train AI systems. In addition, security standards are set to protect so-called “model weights” of closed AI models to prevent hostile actors from accessing this technology.
Criticism from the industry
The chip industry is not happy about the tightened restrictions. In a statement, president of the Semiconductor Industry Association (SIA) John Neuffer lashes out sharply. According to the advocacy group, the rules put the burden on chip technology suppliers and were imposed without any dialogue with the industry.
“This policy change, with enormous impact, is being introduced without meaningful industry input. This risks leaving strategic markets to our competitors, which could cause lasting damage to the U.S. economy and global competitiveness in semiconductors and AI,” Neuffer said. SIA urges consultation to ensure national security without harming industry competitiveness.
It is not yet a certainty that the rules will pass. There is a 120-day period to file any objections. The decision whether or not to push the rules through will rest with Donald Trump.
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