Biden chip bans will backfire – Nvidia executive

The outgoing administration’s proposed export restrictions could damage the US economy, the company’s VP has argued

US chip giant Nvidia has strongly opposed plans by the administration of President Joe Biden to restrict AI chip exports. In an emailed statement cited by Reuters, Nvidia Vice President Ned Finkle criticized the outgoing administration for pushing in a “last-minute policy” that preempts the incoming administration of President-elect Donald Trump.

According to Bloomberg, Biden’s team is rushing to finalize rules limiting exports of AI chips used in data centers by certain firms to  nations considered to be adversaries such as Russia and China.

In December, Reuters reported on a Commerce Department proposal requiring US companies to follow strict compliance measures, such as reporting key details to the government and blocking Chinese access to AI chips.

Finkle warned that these restrictions could “harm the US economy, set America back, and benefit adversaries.”

The Information Technology Industry Council, representing major firms such as Amazon, Microsoft, and Meta, also opposes the restrictions, citing unnecessary constraints on US businesses and advantages for global competitors.

The Biden administration has intensified its AI chip crackdown, expanding a 2023 ban on high-end chip sales to China. In December, additional restrictions targeted 140 entities, including semiconductor equipment makers.

Trump, who enacted similar measures in his first term, will begin his second term on January 20.

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Nvidia urged Biden to reconsider policies with potentially long-term consequences for US technology. Finkle warned that the policy, framed as an “anti-China move,” risks driving global markets toward alternative technologies, undermining US AI leadership.

In December, The Information reported that the US Commerce Department asked Nvidia to investigate how its chips reached China despite the restrictions.

While China lacks advanced chipmaking technology for domestic AI production, universities and research institutes reportedly procured Nvidia chips through resellers, as revealed by Reuters in early 2024.

Nvidia has said it complies with export controls, and that unauthorized resales, including through grey markets, harm its business.