The Biden administration announced a bold and controversial new plan today, designed to prevent advanced chips and artificial intelligence models themselves from ending up in the hands of adversaries like China.
The administration’s new “AI Diffusion rule” divides the world into nations that are allowed unrestricted access to America’s most advanced AI silicon and algorithms, and those that will require special licenses to access the technology. The law, which will be enforced by the Commerce Department’s Bureau of Industry and Security, also seeks to restrict the movement of highly-powered AI models for the first time.
“The US leads the world in AI now, both in AI development and in AI chip design, and it’s important that we keep it that way,” said US Commerce Secretary Gina Raimondo ahead of today’s announcement.
The list of trusted countries is UK, Canada, Australia, Japan, France, Germany, Belgium, Denmark, Finland, Ireland, Italy, Netherlands, New Zealand, Norway, Republic of Korea, Spain, Sweden and Taiwan.
Foreign companies not subject to arms control will be able to obtain up to 1,700 of the latest AI chips without special permission, the law says. They will be able to apply for a special license to get more chips, build larger data centers using US technology, or get access to more powerful closed model “weights” made by US firms. Companies will need to have adequate physical and cyber-security in place to obtain a license.
Supply chain activities, including the design, production, and maintenance of ships will not be exempted from the law. The law also won’t restrict open-source AI models like Meta’s Llama, executives said.
Embargoed countries such as China, Iran, and North Korea have been denied access to advanced chips. The new law will for the first time limit their access to advanced models.
“Semiconductors are that power [AI] and model weights, as we all know, dual technology,” added Raimondo before the announcement. “They are used in many commercial applications, but they can also be used by our enemies to make nuclear simulations, to develop bio-weapons and to improve their military.”
This law is sure to stir up controversy, however, because it could limit international sales of AI at a critical time in the industry. It comes a week before Trump’s inauguration. The decision sets a 120-day consultation period, meaning the Trump administration is expected to listen to comments, possibly change the law, and then implement it.
Nvidia, the world’s leading maker of AI chips, called the rule “unprecedented and flawed” in a blog post. “Although cloaked in an ‘anti-China’ approach, these laws will do nothing to improve US security. Instead of reducing any threat, Biden’s new rules will undermine America’s global competitiveness, undermining the intelligence that has kept the US ahead.
The US already restricts the export of advanced AI chips to China, its main geopolitical rival, but companies have been able to create cutting-edge algorithms using computer clusters found in other nations. Under this new law, China will not be able to build a so-called frontier AI model in other nations affected by this law.