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Washington is considering ways to close a loophole that gives Chinese companies access American AI chips through units abroad, Reuters reported citing people familiar with the matter.
The Biden administration has been cracking down on chip exports to China due to national security fears. It now plans to update the chip export controls as soon as next month.
However, it has been difficult to completely cut China off from top AI technology, given the numerous gaps in export controls that Washington is trying to close.
Overseas subsidiaries of Chinese companies were not included in last year’s crackdown, meaning chips could be smuggled into China or accessed remotely by China-based users.
The U.S. government is also looking at closing the loophole that allows Chinese parties to access U.S. cloud providers like Amazon Web Services, which include AI capabilities, the report added.
“Chinese persons can completely legally access the same chips from anywhere in the world,” said Timothy Fist, a fellow at think tank Center for a New American Security. “There are no rules about how they can be accessed.”