The Biden administration is implementing the “final rule” on AI export controls, and the tech world is applauding again

The Biden White House on Monday announced its “final rule” imposing export controls Artificial intelligence (AI) chips. Before President-elect Donald Trump takes office next week, drawing swift condemnation from industry leaders who argue the Democratic administration is effectively undermining America’s leadership in emerging technology.

With the stated goal of strengthening “the security and economic strength of the United States,” the Biden-Harris administration issued an “Interim Final Rule on AI Deployment.”

A fact sheet issued by the White House said that the initiative “simplifies licensing hurdles for both large and small chip orders, strengthens US leadership in artificial intelligence, and provides clarity to allied and partner nations on how to benefit from artificial intelligence,” as well as “building on chips.” previous”. Controls by thwarting smuggling, closing other loopholes, and raising AI security standards.

When asked whether they had consulted with the incoming Trump administration about this policy, they responded: National Security Advisor Jake Sullivan He cited a “critical window of time” in terms of competition with China, telling reporters on Sunday that the United States was only six to 18 months ahead of Beijing in terms of artificial intelligence technology.

“From our perspective, we have a national security responsibility to do two things. First, to maintain, protect, and extend U.S. AI leadership, particularly those who will be strategic competitors. And second, to ensure that the benefits of U.S. AI are spread to people around the world,” Sullivan said. : “The world, including the global construction of data centers to run artificial intelligence applications.”

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Sullivan said the final rule “ensures that the infrastructure for training border AI, which is the most amazing AI systems at the border, occurs either in America or in the jurisdictions of our closest allies, and that this capability does not shift overseas, like chips, batteries and other industries that “We had to invest hundreds of billions of dollars to bring it back to shore.”

In a call with Sullivan on Sunday, U.S. Commerce Secretary Gina Raimondo explained to reporters how the final rule takes a three-pronged approach.

The minister explained how he is working first to “expand and modernize controls for advanced artificial intelligence chips.” Second, as Raimondo categorizes it, the rule “creates a new set of controls for the weights of more advanced closed-loop AI models (to ensure) they do not fall into the hands of our adversaries.” She said that the third step includes “imposing security conditions to protect critical technology and the largest artificial intelligence groups,” as well as “taking precise steps to ensure that Al-Qaeda is targeted.” National security risks Trade is allowed to continue.”

The measure is “designed to protect the most advanced AI technology and ensure it stays out of the hands of our foreign adversaries, but also enable widespread deployment and benefit-sharing with partner nations,” Raimondo said.

Although the rule is unenforceable for 120 days, industry groups and chip company executives have expressed concern that the administration will implement a complex rule without consulting industry stakeholders in the final days of Biden’s term, arguing that the framework undermines American interests and stifles innovation. .

Mexico, Portugal, Israel and Switzerland are among the countries that may face additional restrictions.

NVIDIA, a major computing and AI technology company based in California, criticized the final rule in a statement issued Monday.

“In its final days in office, the Biden administration is seeking to undermine U.S. leadership with a 200-plus page regulatory morass, drafted in secret and without proper legislative review,” wrote Ned Finkel, vice president of government affairs at NVIDIA. “This sweeping overreach would impose bureaucratic control over how America’s leading semiconductors, computers, systems, and even software are designed and marketed to the world. By attempting to manipulate market outcomes and stifle competition — the lifeblood of innovation — the Biden administration’s new rule threatens to erode the technological advantage that America achieved it hard-won.

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While wearing a costume An “anti-China” measure.“These rules will do nothing to enhance the security of the United States,” Finkel added. “The new rules will control technology around the world, including technology already widely available in gaming PCs and consumer devices. Rather than mitigating any threat, Biden’s new rules will only weaken America’s global competitiveness, And undermining the innovation that has kept the United States ahead.

A technology industry group, the Information Technology Industry (ITI) Council, sent a letter to Raimondo last week asking the US government to “issue any proposed rule as a Notice of Proposed Rulemaking (NPRM), rather than a final or interim final rule” given the potentially significant geopolitical and economic implications. for the proposed approach.

ITI President Jason Oxman warned that the hasty framework proposed by the Biden-Harris administration would disrupt global supply chains and put the United States at a disadvantage.

“As we understand it, the rule will place global restrictions on countries’ access to integrated circuits, regardless of group size or use case,” Oxman wrote. “A rule of this kind would cede the global market to American competitors who would be eager to satisfy untapped demand created by placing arbitrary limits on the ability of American companies to sell core computing systems abroad. If the United States loses its lead in global artificial intelligence, it will “It will be difficult, if not impossible, to recover it in the future.”

The White House fact sheet said the final rule eliminates restrictions on chip sales to 18 key allies and partners. These include Australia, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, Netherlands, New Zealand, Norway, Republic of Korea, Spain, Sweden, Taiwan and the United Kingdom.

However, the rule states that other countries will be subject to restrictions on the chips they can import. The White House said entities “that meet high security and trust standards and are headquartered in close allies and partners” can obtain what the US considers highly trusted “global authorized end user” status.

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For those without this status, purchases will be capped at 50,000 GPUs per country, but government-to-government agreements could be made to increase the cap to 100,000.

Entities headquartered in other countries that do not concern the United States can apply for “National Certified End User” status that allows them to purchase 320,000 advanced GPUs over two years, but has some limitations related to the amount of AI computational power that can Placed abroad by other companies and institutions will apply.

FOX Business’ Sarah Topianski contributed to this report.