The administration of US President Joe Biden is implementing a new law on the export of artificial intelligence chips called the Export Control Framework for Artificial Intelligence (AI) Diffusion. This law has caused considerable dissatisfaction among many AI technology companies. One such company is NVIDIA, the largest AI chip supplier in the world.
Under this law, US companies will be able to supply AI chips to only 20 countries without restrictions: Australia, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, New Zealand, Norway, South Korea, Poland, Spain, Sweden, Switzerland, Taiwan, and the United Kingdom. Four other countries, namely China, Iran, Russia, and North Korea, are completely banned. For more than 100 other countries not on these lists, restrictions will be imposed and they will need a separate license to receive more chips than the US government allows.
The new law is aimed at restricting the access of certain countries to advanced artificial intelligence technologies that can be used for military purposes, such as nuclear weapons modeling or hypersonic missile development. In particular, it aims to make it more difficult for China to obtain modern technologies through third countries.
“The rule both provides greater clarity to our international partners and to industry and counters the serious circumvention and related national security risks posed by countries of concern and malicious actors who may seek to use the advanced American technologies against us,”said the US National Security Advisor Jake Sullivan.
Many American companies have already expressed their dissatisfaction with this decision. In particular, NVIDIA, Orcale, the Semiconductor Industry Association (SIA), the Information Technology and Innovation Foundation (ITIF ) and others have issued statements.
According to many industry representatives, the new law could harm the US position in the global AI market. In a statement, the ITIF noted that restrictions on the export of AI chips could give an advantage to competitors, particularly Chinese companies. The organization emphasizes that although Chinese chips have not reached the same level of power and development as NVIDIA products, companies with limited access to American technology may begin to purchase more Chinese chips to compensate for their performance.
Ned Finkle, NVIDIA's vice president of government affairs, published a statement on the company's official website, in which he noted that the new restrictions threaten innovation and economic growth for NVIDIA itself and other American companies around the world. Finkle also notes that the 200-plus page regulatory document was drafted in secret without any industry representatives.
"This sweeping overreach would impose bureaucratic control over how America’s leading semiconductors, computers, systems and even software are designed and marketed globally. And by attempting to rig market outcomes and stifle competition — the lifeblood of innovation — the Biden Administration’s new rule threatens to squander America’s hard-won technological advantage," Finkle said.