Biden Proposes Controversial Export Restriction On AI Chips

A proposed export restriction on AI chips by the outgoing Biden administration has sparked backlash by the tech industry, with concerns that it could stifle innovation and diminish U.S. leadership in the sector.

The restrictions will enter a 120-day comment period before being decided by the incoming Trump administration.

A Misguided Approach

On January 13th, the White House unveiled a plan that would impose caps and licensing restrictions on semiconductor sales to all but 18 allied nations. Nvidia criticized the framework as misguided, arguing it would hinder innovation and weaken overall competitiveness.

The proposal sets import caps of up to 50,000 semiconductors per country, with government-to-government deals potentially raising the cap to 100,000. Some institutions could purchase up to 320,000 microchips over two years, with small orders not requiring a license.

Mixed Reactions

Daniel Castro warned that pressuring nations to choose between the U.S. and China could alienate key allies. He also noted that foreign competitors could bypass the regulatory burdens faced by U.S. firms.

John Neuffer of the Semiconductor Industry Association expressed concern over the rushed policy, fearing it could harm U.S. economic and technological standing. On the other hand, U.S. Commerce Secretary Gina Raimondo supported the move, emphasizing that it would protect national security while maintaining technological leadership.