U.S. Tightens China’s Access to Advanced Chips for Artificial Intelligence

The Biden administration on Tuesday announced additional limits on sales of advanced semiconductors by American firms, shoring up restrictions issued last October to limit China’s progress on supercomputing and artificial intelligence.

The rules appear likely to halt most shipments of advanced semiconductors from the United States to Chinese data centers, which use them to produce models capable of artificial intelligence. More U.S. companies seeking to sell China advanced chips, or the machinery used to make them, will be required to notify the government of their plans, or obtain a special license.

To prevent the risk that advanced U.S. chips travel to China through third countries, the United States will also require chip makers to obtain licenses to ship to dozens of other countries that are subject to U.S. arms embargoes.

The Biden administration argues that China’s access to such advanced technology is dangerous because it could aid the country’s military in tasks like guiding hypersonic missiles, setting up advanced surveillance systems or cracking top-secret U.S. codes. Leading A.I. experts have warned that the technology, if not properly managed, could pose existential threats to humanity.

But artificial intelligence also has valuable commercial applications, and the tougher restrictions may affect Chinese companies that have been trying to develop A.I. chatbots like ByteDance, the parent company of TikTok, or the internet giant Baidu, industry analysts said. In the longer run, the limits could also weaken China’s economy, given that A.I. is transforming industries ranging from retail to health care.

The limits also appear likely to affect sales to China of U.S. chip makers such as Nvidia, AMD and Intel. Some chip makers earn as much as a third of their revenue from Chinese buyers and spent recent months lobbying against tighter restrictions.