U.S. export controls imposed against China’s semiconductor industry in October (see 2211010042) are so far having “only minimal effects” on the country’s artificial intelligence sector, Reuters reported May 3. Although the rules restricted shipments of certain chips “that have become the global technology industry's standard for developing chatbots” and other AI systems, including chips supplied by Nvidia, the U.S. technology company has created “variants of its chips for the Chinese market that are slowed down” to comply with the new license requirements, the report said.

Placing export controls now on quantum information science technologies likely would “cause more harm than good,” Sam Howell, a research assistant with the Center for a New American Security, said in a May 1 article for the Lawfare blog. Although the U.S. could take several paths in imposing quantum technology restrictions -- including specific end-user controls or broader restrictions targeting “entire integrated quantum systems” -- she said each carries “significant pitfalls and are unlikely to be effective in protecting the U.S.’s strategic edge at this stage of development.”

U.S. hardware supplier MaxLinear said it submitted a “comprehensive” voluntary self-disclosure to the Bureau of Industry and Security in March detailing its potential illegal exports to a Chinese foundry on the Entity List. The company, which submitted an initial notification to BIS last year (see 2211070014), has since hired outside counsel who recently completed a “privileged investigation” of the potential violation, according to its April filing with the SEC. The company also “took immediate action to remediate, including by preventing recurrence.”

U.S. semiconductor company KLA “received clarification” from the U.S. government on matters surrounding chip export controls on China and can “now resume some shipments that we had previously excluded,” the company said as part of its latest earnings report released last week.

The U.S. should work with China in select artificial intelligence areas instead of imposing sweeping export controls that create financial incentives for companies to “design-out” U.S. technology, Paul Scharre, vice president and director of studies at the Center for a New American Security, said in an April 18 opinion article for Time Magazine. While current U.S. restrictions on semiconductors exports to China are “narrowly targeted,” he said they will “de facto grow over time as chips advance and the threshold for export controls remains the same.”

Nations allowing the export to Russia of dual-use products that have military as well as commercial applications are on notice, Commerce Deputy Secretary Don Graves said April 19 at the Space Foundation's 2023 Space Symposium. "Any country ... that seeks to backfill the Russian war machine ... does so at their own peril," he warned. Export controls by the U.S. and 38 other nations aimed at dual-use products such as semiconductors and lasers are "hobbling" the Russian war effort in Ukraine, he said.

The State Department completed a round of interagency review for an interim final rule that would seek public comments on revisions to the U.S. Munitions List. The rule, sent for review Feb. 2 (see 2302030013) and completed April 17, would request feedback “regarding the technology frontier,” which could help the agency identify specific technology capabilities that have “sufficiently evolved” to consider amending the International Traffic in Arms Regulations. The rule could add, revise or exclude certain items from the ITAR.

The Bureau of Industry and Security last week completed its interagency review of new proposed export controls on automated peptide synthesizers. The rule, sent for review at the Office of Information and Regulatory Affairs March 29 (see 2303300003) and completed April 12, could propose new restrictions on certain instruments for the automated synthesis of peptides that could be used to produce biological weapons (see 2209120021).

The U.S. needs to pour more funding and resources into the Bureau of Industry and Security to allow it to better address China-related national security risks, said Gregory Allen, a technology policy expert with the Center for Strategic and International Studies and a former Defense Department official. Although BIS is charged with implementing some of the U.S.’s most sensitive trade restrictions, its export control functions have “had a flat budget for the better part of a decade,” Allen said during a U.S.-China Economic and Security Review Commission hearing last week. “It has been profoundly neglected” and subject to an “appalling mismanagement of resources.”

The Biden administration’s October semiconductor chip controls against China (see 2210070049 and 2211010042) are expected in the short term to “constrain” the country’s access to the most advanced chips “used in computationally intensive subfields” of artificial intelligence, the International Institute for Strategic Studies said in an April report. But the controls could spur Chinese AI researchers toward “subfields that are less computationally demanding” and lead them to develop “new competitive advantages” in those areas, the report said.