Biden Administration Proposes New Restrictions on Advanced AI Chips Sales

The Biden administration has introduced extensive restrictions on the sale of advanced AI chips by semiconductor companies like Nvidia.

These new rules will cap the export of AI chips to most countries, ensuring unlimited access only for trusted allies such as the UK and South Korea. Meanwhile, nations like China, Russia, Iran, and North Korea will remain blocked from accessing US AI technology. The regulations are scheduled to take effect in one year.

Commerce Secretary Gina Raimondo emphasized the importance of maintaining US leadership in AI. She stated, “The U.S. leads AI now—both AI development and AI chip design, and it’s critical that we keep it that way.”

She highlighted that the administration aims to balance national security concerns with the need to support global trade in AI chips.

New GPU Export Restrictions Aim to Balance AI Leadership and Global Trade

The US will impose new restrictions on advanced GPUs, critical for powering data centers that train AI models. However, gaming chips remain unaffected by these rules.

Nvidia criticized the regulations, calling them a “sweeping overreach” and arguing that the White House is targeting technology already available in mainstream gaming PCs and consumer hardware.

Once the rules take effect, cloud service providers like Microsoft, Google, and Amazon can apply for global authorizations to build data centers. These authorizations will eliminate the need for export licenses for AI chips, allowing data center construction in countries impacted by US-imposed quotas.

US-based providers receiving global authorizations, such as Amazon Web Services and Microsoft, will face new deployment limits. They can deploy up to 50% of their total AI computing power outside the US, 25% outside Tier 1 countries, and no more than 7% in a single non-Tier 1 country.

The Biden administration has consistently updated its export controls to restrict China’s access to advanced chips and related production equipment. These annual updates aim to close loopholes and limit technology diversion to countries at risk of transferring it to China.