The rules were an effort to ensure that the world's largest data centers were built by the United States and its allies, not by the Middle East or elsewhere. Biden officials were skeptical of the dictatorial tendencies of the United Arab Emirates and Saudi Arabia and their relations with China. They also argued that the rules could limit access to AI chips and data centers in other countries in China, and strengthen Beijing's strategic and military capabilities.
The rules, scheduled to come into effect on May 15, allowed unlimited sales of AI chips to 18 allies, including the UK, Germany and Japan, blocking sales to China, Iran and other enemies. All other countries, including Saudi Arabia, the United Arab Emirates, Qatar, India, Israel and Poland, face a cap on the number of tips they can buy, and many weren't happy about it.
Jim Secre, former vice-chief of staff at the Commerce Department, said the rules are intended to maintain national security and shape the future of critical technologies. Without regulations, the availability of cheap energy and capital overseas may mean that more data centers will be built outside the US than inside.
“Controlling AI is a geopolitical issue in our time,” he said.
Companies like Nvidia and Oracle have also protested the rules, saying it backfired US technology leadership. Trump officials seemed to agree with the argument. On Wednesday, the administration submitted a submission that it would publish new rules that would revoke the previous framework, although it did not give a timeline for changes.
“The Biden AI rules are overly complicated and bureaucratic and will stymie American innovation,” Ben Kass, a spokesman for the Department of Commerce, which oversees technology management, said in a statement. “We are prioritizing US domination and replacing it with a simpler, clearer framework that unlocks the fullest potential of American AI innovation.”
