The US Department of Commerce on Sunday unexpectedly moved to close a year-old potential loophole that may have allowed the export of the world’s most advanced AI chips to Chinese entities located outside China. The guidance targets processors such as Nvidia’s Rubin and Blackwell lines, as well as AMD’s MI350x.
The move suggests that top-tier American AI chips may have been reaching subsidiaries of Chinese AI firms based in countries like Malaysia. By closing this avenue, Washington aims to prevent its most sophisticated technology from bolstering Beijing’s artificial intelligence capabilities.
The new restrictions focus on shipments to Chinese-owned or controlled companies operating beyond mainland China. The Commerce Department did not immediately provide a timeline for enforcement, but the guidance signals a tightening of export controls that have been a cornerstone of US-China tech rivalry.
For Nvidia and AMD, the policy adds another layer of complexity to their global supply chains. Both companies have navigated previous restrictions by designing chips for non-Chinese markets, but this move could shrink their addressable customer base further.
The impact on Chinese AI firms could be significant, potentially slowing their access to cutting-edge hardware for training large models. However, some analysts argue that Chinese companies have been stockpiling chips and developing domestic alternatives, which may mitigate the immediate effects.