Admin Biden Enacts 'Final Rule' on AI Export Controls, Tech World Responds

The Biden White House on Monday announced its “final rule” to impose export controls artificial intelligence (AI) chips Before President-elect Donald Trump takes office next week, it drew 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 released the “Interim Final Rule on the Proliferation of Artificial Intelligence.”

A White House fact sheet states that the initiative will “simplify licensing barriers for large and small chip orders, strengthen US AI leadership, and provide transparency to allied and partner nations about how AI can benefit.” “gives” and also “builds on previous chips”. It is controlled by preventing smuggling, closing other loopholes and increasing AI security standards.”

When asked if they had consulted with the incoming Trump administration about the policy? National Security Adviser Jake Sullivan He pointed to a “critical time window” in terms of competing with China, telling reporters on Sunday that the United States is six to 18 months ahead of Beijing in AI technology.

“From our perspective, we have a national security responsibility to do two things. First, to maintain, protect, and expand America's AI leadership, especially these will be strategic competitors. And second, to ensure that the benefits of America's AI reach those around us. It's spreading around the world, including building global data centers to run artificial intelligence applications.

Sullivan claimed that the Biden administration would leave Russia, China and Iran “weaker” and America “safer” before the Trump transition.

Sullivan said the final rule “ensures that the border AI training infrastructure, the most sophisticated AI systems at the border, happens either in the United States or in the jurisdictions of our closest allies, and that capacity doesn't disappear like chips.” And batteries and other industries that we would have to invest hundreds of billions of dollars to bring back to land.”

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 secretary explained how he would first work on “expanding and updating controls for advanced artificial intelligence chips.” Second, as Raimondo classified it, the legislation would work to “create a new set of controls for the most advanced closed AI model weights (to make sure they don't fall into the hands of our adversaries). The third step, he said, involves “imposing security conditions to protect critical technology and the largest clusters of artificial intelligence” as well as “taking detailed steps to ensure that this law is targeted.” National security risks And allows business to continue.”

Raimondo said the move is “designed to protect the most advanced AI technology and ensure it stays out of the hands of our foreign adversaries, but also allows for widespread dissemination and benefit sharing with partner nations.”

Although the law won't go into effect for 120 days, industry groups and chip company executives expressed concern that the administration would push through the complex rule without consulting industry stakeholders in the final days of Biden's presidency, arguing that the framework would serve U.S. interests. It weakens United and stifles innovation.

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

NVIDIA, a California-based computing and artificial intelligence technology giant, criticized the final rule in a statement released Monday.

Ned Finkel, vice president of government affairs at Nvidia, wrote: “In its final days, the Biden administration is seeking to undermine American leadership with a more than 200-page surveillance morass prepared in secret without proper legal review.” He added: “This widespread manipulation imposes bureaucratic control over the way America's leading semiconductors, computers, systems and even software are designed and marketed globally. And by trying to manipulate market outcomes and stifle competition—the lifeblood of innovation—the Biden administration's new law threatens to be wasteful. America's hard-won technological advantage.

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“While in the guise of one “Anti-China” action“The new rules will govern technology around the world, including technologies that are already widely available in mainstream gaming computers and consumer hardware,” Finkel added. Instead of reducing any threat, Biden's new rules will only weaken America's global competitiveness and undermine the innovation that has kept the United States at the forefront.

A technology industry group, the Information Technology Industry Council (ITI), sent a letter to Raimondo last week asking the US government to “issue any proposed rulemaking as a Notice of Proposed Rulemaking (NPRM), not a rule.” final or temporary final. Considering the potential geopolitical and economic consequences of 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, this rule would establish universal limits on access by states to integrated circuits, regardless of cluster size or use cases,” Oxman wrote. “A rule of this type would cede the global market to American competitors eager to fill the untapped demand created by imposing arbitrary restrictions on the ability of American companies to sell basic computing systems abroad. If the United States has an advantage lose itself in global artificial intelligence. It will be difficult, if not impossible, to recover the ecosystem in the future.”

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

However, the law believes that other countries will impose restrictions on the chips they can import. The White House said entities that “have high security and trust standards and are based in close allies and partners” can earn highly trusted “Global Verified End User” status.

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For those without this status, the purchase cap will be 50,000 GPUs per country, but government-to-government agreements could be reached to increase that limit to 100,000.

Entities headquartered in other countries that do not concern the United States can apply for “national approved end-user” status, which allows them to purchase up to 320,000 advanced graphics processing units over two years, but with some restrictions on How much computational capacity of artificial intelligence can be applied. It will be applied abroad by other companies and institutions.

FOX Business' Sarah Tobiansky contributed to this report.