According to the U.S. government website, the U.S. Commerce Department on Friday withdrew a planned rule regarding the export of artificial intelligence chips.

The draft rule, aimed at regulating global access to artificial intelligence chips, was sent to other organizations for comments in late February. The reason for the withdrawal was not given.

A spokesperson for the U.S. Department of Commerce has not yet responded to this matter.

This withdrawal marks another setback by the Trump administration in rescinding and replacing the framework for exporting artificial intelligence chips released by the Biden administration in January 2025.

Last spring, the Commerce Department said it would replace the rule with a simpler one to ensure U.S. dominance in artificial intelligence.

That rule, titled "Implementation of the Artificial Intelligence Action Plan," was posted on the Office of Information and Regulatory Affairs website on February 26, initially listed as "pending review," before being withdrawn.

About the Action

A document seen by Reuters shows the plan considers requiring foreign investment in U.S. data centers or security guarantees as a condition for allowing the export of 200,000 or more chips.

This plan contrasts sharply with Biden's proposal, which exempts close U.S. allies from most restrictions on the export of valuable chips and divides the world into three tiers. Biden's provision marks the culmination of his administration's four-year effort to limit China's access to advanced chips while maintaining U.S. leadership in artificial intelligence.

A former official said on Friday that the withdrawal of the latest proposed rule may reflect internal disagreements within the administration on how to achieve global AI dominance and address national security concerns.

The U.S. Commerce Department issued a statement on March 5 via its social media service X, saying it was discussing new rules, but these would not resemble the "cumbersome, excessive, and disastrous" framework proposed by the Biden administration.

However, according to Reuters, sources familiar with the draft revealed that it also appears quite cumbersome.

Previously: The US considered introducing new regulations for AI chip exports

A few days ago, a document revealed that U.S. officials were debating a new regulatory framework for exporting artificial intelligence (AI) chips, considering requiring foreign traders to invest in or provide security guarantees for U.S. AI data centers as a condition for approving the export of large quantities of chips to them.

According to the document seen by Reuters, these rules are not yet finalized and are subject to change. This would be the first attempt to regulate the outflow of AI chips to U.S. allies and partners since the Trump administration announced it had repealed the previous administration's so-called AI Diffusion Rule. Those previous rules aimed to keep a significant amount of AI infrastructure construction within the United States and to have most procurement done through a few U.S. cloud computing companies.

The document shows that under the new regulatory framework being considered by the Trump administration, even smaller installation projects with fewer than 1,000 chips might require a license. To qualify for an exemption, chip exporters like Nvidia or Advanced Micro Devices (AMD) must monitor these projects, and the recipients must agree to the use of software that prevents these chips from connecting with other chips to form a larger "cluster." "Cluster" is a term used in the artificial intelligence industry to describe large chipsets.

In a statement posted on the social media platform X, the U.S. Department of Commerce confirmed that it is discussing new rules, but stated that these rules will not resemble the framework proposed by the previous administration, which the Department described as "cumbersome, overreaching, and extremely poor."

Instead, the Department of Commerce stated that the new rules will follow the model of agreements for exporting U.S. chips to Saudi Arabia and the United Arab Emirates. In these agreements, both countries agreed to invest in the United States.

"The Department of Commerce is committed to facilitating the secure export of U.S. technology stacks," the department wrote in the statement. "We have successfully advanced exports through historic Middle East agreements, and there are discussions within the government to formalize this practice."

Source: Semiconductor Industry Observer (compiled)

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