Nvidia calls Biden’s last AI export rule ‘sweeping overreach’

As expected, the White House of outgoing President Biden has announced an Interim Final Rule (IFR) on the sale of AI chips around the world. Immediately, AI processor and GPU company Nvidia Corp. has attacked it as harmful to US technology leadership.

Criticism of the IFR had already been made by the Semiconductor Industry Association and cloud computing provider Oracle. Opponents had called for the outgoing US administration to leave the matter to the incoming one. Donald Trump is due to be inaugurated as US President on January 20.

On Monday the Biden administration officially announced its Interim Final Ruling (IFR) on AI Diffusion and the plan to cap the sales of AI chips and GPUs to most of the world’s countries with 18 allies and partners excepted.

The AI Diffusion measure is intended to build “on previous chip controls by thwarting smuggling, closing other loopholes, and raising AI security standards,” according to a White House fact sheet. The measure includes, country caps on sales measured against so-called advanced GPU equivalents and processes to achieve universal and national verified end-user (UVEU and NVEU) status.

However, Ned Finkle, Nvidia’s vice president for government affairs, has immediately published a blog article saying the AI Diffusion rule will be counterproductive.

The Biden administration has been frustrated by seeing GPUs continue to be exported into China via complex routes and against the intentions of previous export rules crafted on a by-company basis. However, the adoption of a global and by-country approach in the IFR has produced an outcry from the semiconductor and IT industries.

Finkle described the IFR as a “sweeping overreach” and said it was “200-plus page regulatory morass drafted in secret and without proper legislative review.”

Finkle continued: “The new rules would control technology worldwide, including technology that is already widely available in mainstream gaming PCs and consumer hardware.”

However, the IFR may never be enforced.

Reportedly the rule is not enforceable for at least 120 days – and 60 days from after it is published on the Federal Register. This will give the incoming Trump administration the chance to cancel the IFR or delay it and engage in industry consultation before redrafting the measure.