The Commerce Department has issued a rule that increases export controls on AI-related items.
The rule:
- Significantly expands controls on advanced computing items.
- Affected products include advanced computing integrated circuits, computers, electronic assemblies and components containing such integrated circuits, and related software and technical know-how.
- Subject to exceptions, the restrictions will require licenses to supply affected products to locations other than 18 U.S. allies.
- Establishes country-specific total processing performance quotas to supply advanced computing items to most countries – an unprecedented step.
- Imposes controls – for the first time – on certain advanced non-published AI model weights.
Most of the restrictions are scheduled to take effect on May 15, 2025, although some do not come into effect until January 15, 2026.
The Bureau of Industry and Security is seeking comments on the rule by May 15, 2025.
3 Key Takeaways
1. Regulators have expanded controls on advanced computing items.
The rule:
- Imposes a new worldwide license requirement on supply of advanced integrated circuits and other advanced computing items. This replaces a prior licensing requirement generally pertaining only to supply to certain countries of concern, including China.
- Expands the destination scope of the advanced computing foreign direct product rule. Unless exempt, foreign-produced advanced computing items that are the direct product of certain U.S. software or technology will require a license to ship to any country.
- Creates three new license exceptions to mitigate the impact of the new controls.
- Artificial Intelligence Authorization (AIA): Authorizes supply of controlled advanced computing items and unpublished AI model weights to entities located and headquartered in the United States or 18 allied countries. Using this new license exception requires obtaining a prior end use certification from the ultimate consignee and, for certain large orders, providing the certification to BIS.
- Advanced Compute Manufacturing (ACM): Authorizes supply of controlled advanced computing items to private sector end users not located or headquartered in Macau or a country subject to a U.S. arms embargo. The supply is authorized for the sole purpose of developing, producing or storing advanced computing items before they are sent to customers outside of such countries.
- Low Processing Performance (LPP): Authorizes direct supply to ultimate consignees in countries not subject to a U.S. arms embargo of advanced computing items that do not present significant national security risks – up to a cumulative total processing performance of 26.9 million per year per ultimate consignee. Exports pursuant to this license exception do not count toward country-specific total processing performance allocations (see below).This new license exception is subject to certain certification and reporting requirements.
- Expands the Advanced Computing Authorized (ACA) license exception. The exception currently authorizes exports of advanced computing items not designed or marketed for data centers to certain countries of concern. Given the new controls, this exception will be available for shipments worldwide, other than to Macau and countries subject to a U.S. arms embargo.
- Alters the existing authorization to ship to “validated” data-center end users. That authorization currently allows U.S. exporters to ship designated items to pre-approved entities under a general authorization instead of under multiple individual export licenses. The new rule creates a:
- Universal authorization that allows companies in the United States and 18 allied countries to obtain large quantities of advanced computing items to build data centers, except in countries subject to a U.S. arms embargo, subject to geographic and volume restrictions.
- National authorization that allows companies in other countries to seek a single authorization to obtain advanced computing items to build data centers in specified locations, subject to quarterly facility-specific total processing performance quotas for the next three years. These quotas will not count towards country-wide allocations.
2. The rule establishes country-specific total processing performance allocations.
For the first time, the rule establishes country-specific total processing performance allocations for licensable supply of advanced computing items to most countries (except the 18 U.S. allies or countries subject to a U.S. arms embargo).
A presumption of approval will apply to review of license applications within the allocations.
Through the end of 2027, the cumulative maximum allocation will be 790 million total processing performance. BIS may increase the allocation by up to 100% for countries that provide the U.S. government with assurances related to national security.
3. New controls apply to AI model weights.
The rule introduces controls on AI “model weights” – AI model parameters that help determine the model’s outputs in response to inputs through computationally intensive model training.
New ECCN 4E091 controls, as technology, worldwide supply of unpublished (closed-weight) model weights for AI models that have been trained using 1026 or more computational operations. Published (open-weight) AI model weights are not subject to control. A presumption of denial will apply for all license applications pertaining to ECCN 4E901 model weights, except for exports to companies headquartered in U.S.-allied countries.
New foreign direct product rule controls AI model weights developed outside the United States if they meet the criteria for ECCN 4E091 and are the direct product of U.S.-controlled advanced computing items.
The rule alerts Infrastructure-as-a-Service cloud computing providers in the United States to potential unlicensed supply of controlled AI model weights when their products are being used to train an advanced AI model for a customer headquartered, or whose ultimate parent is headquartered, in any destination other than one of the 18 allied countries.