Before leaving office, U.S. President Joe Biden signed a new law regulating artificial intelligence (AI) chips, imposing global export restrictions on AI chips manufactured in the United States. The legislation aims to prevent rival nations, such as China, from leveraging advanced American technology to pose potential threats.
The law, titled the Interim Final Rule on Artificial Intelligence Diffusion, categorizes the export of U.S.-made AI chips into three levels. These include partner and allied nations, countries previously prohibited from receiving exports, and newly targeted nations under the expanded regulations. This framework seeks to prevent specific countries from circumventing export restrictions and indirectly acquiring advanced U.S. AI chips and related technologies.
Partner and allied nations in the first tier, such as Taiwan, Japan, South Korea, India, and Germany—spanning 18 countries and regions—will remain largely unaffected. Meanwhile, third-tier nations, including China and Russia, were already subject to export bans. The new restrictions primarily impact second-tier nations, which previously faced fewer limitations. These measures include setting limits on computing power that can be purchased and requiring additional applications for approvals, creating significant hurdles for these countries when procuring AI chips in the future.
For second-tier nations, the law caps the purchase of high-end AI chips at 50,000 units. However, if these nations align with the U.S. on key objectives such as technological security and renewable energy, they may apply to raise the limit to 100,000 units.
In certain cases, specific institutions within these nations may apply to procure up to 320,000 high-end AI chips over a two-year period, albeit with strict overall deployment caps on AI computational power.
This new legislation, however, has drawn significant criticism from tech industry leaders, who argue that it could undermine U.S. competitiveness in the global technology market.
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