US Enforces New Restrictions on AI Chip Exports to Chinese Firms
US Commerce Department moves to block Nvidia and AMD chip flows to Chinese overseas units
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The US Commerce Department has tightened export controls on advanced AI chips from Nvidia and AMD to Chinese firms, closing a loophole that allowed these chips to reach overseas subsidiaries. This move aims to limit China's access to cutting-edge technology amid ongoing geopolitical tensions.
- 01The US Commerce Department's new guidance requires licenses for advanced AI chips sold to Chinese entities, regardless of their physical location.
- 02This regulatory change addresses a loophole that had allowed hundreds of thousands of Nvidia and AMD chips to be exported to Chinese firms through overseas subsidiaries.
- 03Chips affected include Nvidia's Rubin and Blackwell processors and AMD's MI350x, which are crucial for AI development.
- 04The guidance does not require data centers to stop using or servicing already installed chips, reducing immediate operational disruptions.
- 05The move reflects a broader US strategy to constrain China's technological advancements in artificial intelligence.
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The US Commerce Department has enacted new guidance to enforce licensing requirements for advanced AI chips sold to Chinese firms, even when these firms operate outside China. This decision closes a loophole that had existed since May 2025, allowing hundreds of thousands of Nvidia and AMD chips to be exported to Chinese subsidiaries. The chips in question include Nvidia's Rubin and Blackwell processors and AMD's MI350x, which are vital for AI technology. Chris McGuire, a former State Department official, highlighted the significant scale of these transactions prior to the new regulations. While the guidance does not mandate the cessation of operations for already installed chips, it introduces new compliance challenges for semiconductor supply chains, particularly those routed through Southeast Asia. This action is part of the US's ongoing efforts to limit China's access to advanced technology and raises concerns about future regulatory scrutiny and enforcement mechanisms.
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The new guidance may lead to increased compliance costs for companies involved in semiconductor supply chains and could slow down deal flow as firms assess their exposure.
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