AI Potential U.S. Trade Embargo Subject

Article By : Rick Merritt

Restricted goods/services list includes 14 areas, including AI

SAN JOSE, Calif. — Uncle Sam wants to restrict a few good technologies — and it needs engineers to help identify them.

As part of legislation passed this summer, the U.S. Commerce Department put out a call for input by Dec. 19 on which of 14 broad emerging technologies should face export controls. The call quickly got attention from industry veterans and groups concerned that controls could hurt U.S. companies and worsen a growing tech trade war with China.

The call issued on Nov. 14 listed aspects of biotech, AI, quantum computing, semiconductors, robotics, drones, and advanced materials as possible candidates. It gave special attention to AI, listing 10 specific areas ranging from computer vision and natural-language processing to AI chipsets. In semiconductors, it called out even broader areas including microprocessor technology, SoCs, stacked memory on chip, and memory-centric logic.

The effort aims to determine which emerging technologies could be strategic to national security and how to identify and control them without “negatively impacting U.S. leadership in the science, technology, engineering, and manufacturing sectors.” It did not define the range of the controls except to say that, “at a minimum, it [would] require a license for [their] export … to countries subject to a U.S. embargo, including those subject to an arms embargo.”

A government spokesperson said that the Commerce Dept. plans to publish proposed controls on emerging technologies after reviewing comments to its call. It will take public comments on the proposed controls before making them final, but the spokesperson gave no timeline for the process.

The Commerce Dept. is expected to issue a second call early next year for guidance on what it calls fundamental or more mature technologies, including semiconductors and manufacturing equipment. The actions stem from the Foreign Investment Risk Reduction Management Act (FIRRMA) aimed to use export controls to stem a perceived leaking of sensitive technologies, especially to China.

The bill also expanded the role of the Committee on Foreign Investment in the U.S. Under an 18-month pilot program, CFIUS can now review non-controlling investments in U.S. companies in 27 areas, including semiconductors and semiconductor tools.

More than a dozen reactions to the Commerce call are already live on the government’s website, several pointing out the challenges and dangers of the effort. The Association for Computing Machinery is one of multiple groups requesting up to a 60-day extension of the deadline to submit responses due to the effort’s “enormous import not only to national security but to the future of American technological progress in industry and academia.”

“The list of technologies that Commerce is considering for controls is so broad that restrictions could severely limit opportunities to participate in international markets, weakening U.S. companies and U.S. competitiveness overall,” said Chris Rowen, a serial entrepreneur in semiconductors, now CEO of BabbleLabs, an AI software startup in Campbell, California.

The idea of export controls on AI is “analogous to saying, ‘Let’s not export software because it’s used in military systems,’” said Rowen, who is preparing his own response to the government call.

“AI has become a basic software technique. I would not limit it in sweeping ways … they need to focus on areas where the majority of use is associated with the military.”

Nvidia is most likely to feel the impact of any export controls on AI given that its GPUs are widely used for training neural networks in data centers of global web giants such as Amazon, Alibaba, and Google. Controlling sales of its GPUs could “represent one of the few temporary choke points in AI development,” said Rowen.

Both Nvidia and Intel declined to comment on the government effort.

The move comes at an interesting moment in the rising trade war between the U.S. and China. President Trump and China’s Xi Jinping are expected to meet in Buenos Aires this weekend. It will be their first encounter since the two started levying increasing tariffs on each other’s goods, moves that industry groups lobbied against.

Looking toward the new export controls, industry representatives “just want to make sure this process is done thoughtfully, with a scalpel and not an ax,” said one expert, who asked not to be named.

One of the trickiest parts of the export controls is untangling so-called dual-use technologies that have clear military and commercial uses.

“We want appropriate controls on a targeted subset of technologies relevant to security interests, but we want to make sure we have access to commercial markets around the world … in addition, it serves no purpose if the U.S. controls technology that’s available elsewhere,” said the expert.

Another challenge is that China, the primary target of the moves, “is a big part of the tech supply chain and one of the largest markets for U.S. semiconductors,” he added.

It’s unclear how long the process will take. Government policy makers will need time to sift through what could become hundreds of comments to form proposed export controls. Industry representatives hope that they get at least 90 days to review and comment on the proposed rules before they are made final.

“We view this as a really important process that our industry is taking very seriously and plan to engage in because the outcomes are of great consequence for us,” Christian Troncoso, a policy director at BSA, a Washington-based trade group for companies including Apple, Microsoft, IBM, and Oracle, told the Washington Post.

— Rick Merritt, Silicon Valley Bureau Chief, EE Times