The administration of President Donald Trump has taken a tougher stance on Chinese technological advancement, particularly regarding artificial intelligence (AI). The U.S. Department of Commerce has issued guidelines stating that even the mere use of Huawei’s Ascend series chips anywhere in the world would constitute a violation of U.S. export controls.
The Bureau of Industry and Security, which operates within the Department of Commerce and oversees export regulations, clarified that Huawei chips almost certainly contain U.S. technology or were produced with the help of U.S. software and equipment. Therefore, U.S. authorities believe they are automatically covered by existing export restrictions.
– These guidelines are not new rules, but a public confirmation of the existing interpretation: even the mere use of an advanced chip designed by Huawei constitutes a violation of export controls – stated Kevin Wolf, an export regulation expert and partner at the law firm Akin Gump.
Three Chips Under Scrutiny
The Bureau of Industry and Security specifically highlights three models of Huawei Ascend chips: 910B, 910C, and 910D. According to official documents, these chips were almost certainly developed with the help of U.S. tools or produced on machines that represent a ‘direct product of U.S. origin’.
The controversial chips are used in so-called Clusters, a large number of processors connected in a system that allows for the processing of extremely large amounts of data. Huawei claims that their clusters based on 910C chips outperform the performance of comparable Nvidia systems, particularly in terms of overall computing power and memory. Individually, these chips do not reach the most advanced Nvidia models like the H100, but in combination, they surpass them, raising additional concerns in the U.S.
China Expands Capacities
Huawei, which has been on the U.S. ‘blacklist’ for years, is building its own manufacturing facilities for advanced chips, attempting to circumvent sanctions and ensure self-sufficiency in key technology. Chinese companies, which no longer have access to the latest Nvidia chips, are increasingly ordering Ascend processors, thereby strengthening Huawei’s position as a national technology leader.
Nvidia’s CEO, Jensen Huang, recently acknowledged that Huawei is ‘one of the most impressive technology companies in the world’, urging U.S. authorities to ensure conditions for fair market competition. Although Nvidia declined to comment on the government’s new guidelines, it is clear that concerns are growing, not only due to Chinese technological advancement but also due to the potential loss of international markets.
Withdrawn Regulation
On the same day that the guidelines on Huawei chips were announced, the Department of Commerce withdrew the so-called AI Diffusion Rule – a regulation that the Biden administration planned to activate on May 15. This measure would have further restricted the export of AI chips, particularly those capable of training advanced language models, but was deemed ‘too bureaucratic’. Former officials from the Biden administration dismissed such an assessment, warning that withdrawal could weaken the U.S. position in the technological competition with China.
Controversial Deals in the Middle East
Interestingly, the announcement of the new guidelines coincided with Donald Trump’s visit to Saudi Arabia, where the former president participated in the announcement of a series of technology contracts. Among them is a deal between the new Saudi state AI company Humain and Nvidia, which would build infrastructure in the region based on hundreds of thousands of advanced AI chips. According to sources close to the administration, the scale of planned investments in AI in the region shocked many officials, especially due to the existing ties between Saudi Arabia and the United Arab Emirates with the Chinese technology sector.
