New AI Chip Export Policy Planned: Trump Reverses Biden Regulations
In a recent development, the Trump administration has announced plans to rescind and modify a Biden-era rule that restricted the export of advanced artificial intelligence (AI) chips, according to a Department of Commerce spokeswoman. Specifically, the administration aims to replace the existing framework with a simpler rule that, in turn, promotes American innovation and maintains U.S. dominance in AI technology.
The Biden administration implemented the rule, known as the Framework for Artificial Intelligence Diffusion, in January during its final days. It established a tiered system for exporting AI chips, with varying levels of restrictions for different countries including Malaysia. The Trump administration has deemed this system “overly complex” and “unenforceable.”
Key Aspects of the Proposed Changes
- Rejection of the Tiered System: Trump administration officials have expressed their disapproval of the tiered system created by the Biden administration, finding it unenforceable.
- Potential Global Licensing Regime: The administration is considering replacing the tiered system with a global licensing regime involving government-to-government agreements.
- Focus on American Innovation: The new rule will prioritise “unleashing American innovation and ensuring American AI dominance.”
- Impact on Industry: News of the potential rule change has already impacted the market, with shares of Nvidia, a leading AI chip designer, experiencing fluctuations.
- Concerns about China: Similar to the Biden administration’s goals, the Trump administration also aims to restrict China’s access to advanced AI chips to maintain U.S. and allied technological advantages.
- Enforcement Focus: The Commerce Department will continue to strictly enforce chip export curbs while developing the new rule.
- Targeting Chip Diversion: The regulatory overhaul will include measures to control chip exports to countries found to be diverting them to China, specifically mentioning Malaysia and Thailand.
Comparison of the Old and Proposed Systems
Under the Biden-era rule, the world was divided into three tiers, with countries like China, Russia, Iran, and North Korea facing the strictest restrictions. However, the Trump administration’s proposed changes signal a shift away from this geographically segmented approach and instead point towards a potentially more centralised licensing system.
The exact timeline for the implementation of the new rule remains unclear, as officials continue to debate the best course of action.
