This illustrated photo taken on February 17, 2023 shows a semiconductor chip on a printed circuit board.Reuters/Florence Law/Illustration/File photo Obtaining license rights
Oct. 15 (Reuters) – U.S. officials say they will allow U.S. semiconductor manufacturers to circumvent government regulations and send products to China as part of the Biden administration’s upcoming measures to effectively block expanded exports of AI chips. He said he plans to take measures to prevent the sale.
The new rules, first detailed by Reuters, add to broader U.S. restrictions on shipments of advanced chips and semiconductor manufacturing equipment to China announced last October. Other people familiar with the matter said the update is expected to occur this week, but such schedules often vary.
The new rules will block some AI chips that fall within current technical parameters, while requiring companies to report shipments of other AI chips, said the official, who provided the information on condition of anonymity. He says he will.
A spokeswoman for the U.S. Department of Commerce, which oversees export controls, declined to comment.
The recent crackdown on high-tech exports to China coincides with US efforts to mend fractious relations between the world’s two largest economies. Several Biden administration officials have met with their Chinese counterparts in recent months, and the latest rules risk complicating diplomatic efforts.
Last year, government regulations prevented Nvidia (NVDA.O), the world’s most valuable chipmaker, from shipping two of its most advanced AI chips to customers in China. The chip has become the industry standard for developing chatbots and other AI systems.
However, NVIDIA soon released a new variant for the Chinese market that is less sophisticated and circumvents US export controls. One, named H800, has computing power comparable to the company’s more powerful but blocked H100 chip in some settings used in AI work. Specifications seen by Reuters show that some key performance aspects remain limited.
The United States now plans to introduce new guidelines on AI chips that will restrict certain advanced data center AI chips that are currently not captured, officials said.
U.S. officials did not say what additional chips would effectively be banned, but sources suggested NVIDIA’s H800 is a semiconductor the government wants to ban.
Chips used in consumer products such as laptops will be exempt from the new regulation, the official said. But officials say companies must notify the Commerce Department when filling orders for the most powerful consumer chips to ensure they are not being used in a way that threatens national security.
The October 2022 rule update is intended to also cover AI chips as the technology evolves. The U.S. plans to require companies to notify the government of semiconductors with performance slightly below guidelines before shipping them to China, the official said. The government will decide on a case-by-case basis whether it poses a national security risk but can be shipped unless chipmakers are told otherwise.
As Reuters reported last week, the new regulations could also close a loophole that allows Chinese companies to access U.S. artificial intelligence chips through their overseas Chinese units.
The rule is not expected to include restrictions on access to cloud computing services in the United States or its allies, but will seek comment on the risks of such access and how to address them, the official said.
Reuters reported in early October that the Biden administration has told Beijing it plans to update the controversial rules this month as part of a policy aimed at stabilizing relations between the superpowers.
Reporting by Karen Freifeld. Additional reporting by Max A. Cherney.Editing: Chris Sanders, Lisa Shoemaker, Deepa Babington
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