US President Donald Trump’s administration plans to rescind and modify a Biden-era rule that curbed the export of sophisticated AI chips, a spokeswoman for the Department of Commerce said on Wednesday.
The regulation was aimed at further restricting AI chip and technology exports, dividing up the world to keep advanced computing power in the United States and among its allies while finding more ways to block China’s access.
Australia is one of 18 countries exempt from the rules, putting it ahead of hundreds of other countries that will be subject to limits on advanced computing chip imports or banned from accessing them altogether.
The Framework for Artificial Intelligence Diffusion was issued in January, a week before the end of the administration of former US President Joe Biden. It capped a four-year effort by the Biden administration to hobble China’s access to advanced chips that could enhance its military capabilities and to maintain US leadership in AI.
“The Biden AI rule is overly complex, overly bureaucratic, and would stymie American innovation,” the Commerce spokeswoman said. “We will be replacing it with a much simpler rule that unleashes American innovation and ensures American AI dominance.”
Last week, Reuters reported the Trump administration was working on changes to the rule that would limit global access to AI chips, including possibly doing away with its splitting the world into tiers that help determine how many advanced semiconductors a country can obtain.
According to the Commerce spokeswoman, officials “didn’t like the tiered system” and said the rule was “unenforceable”. The spokeswoman did not have a timetable for the new rule. She said debate was still under way on the best course of action. The Biden rule was set to take effect on May 15.
Shares of Nvidia, an AI chip designer whose sales could rise if the rule were changed to increase exports, ended 3 per cent higher after the news came out on Wednesday, but then dipped 0.7 per cent in after-hours trade.
The Biden rule divided the world into three tiers, with 17 countries and Taiwan in the first tier, which could receive unlimited chips, and some 120 other countries in the second tier and subject to caps on the number of chips.
In the third tier, countries of concern including China, Russia, Iran and North Korea were blocked from the chips.
But Trump administration officials are weighing discarding the tiered approach to access in the rule and replacing it with a global licensing regime with government-to-government agreements, sources told Reuters last week.
– Reuters with Justin Hendry
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