President Donald Trump will rescind a set of Biden-era curbs meant to keep advanced technology out of the hands of foreign adversaries but that has been panned by tech giants.
The move could have sweeping impacts on the global distribution of critical AI chips, as well as which companies profit from the new technology and America’s position as a world leader in artificial intelligence.
“I vocally opposed this rule for months, and indeed, the ranking member and I together urge the Biden administration not to adopt it, and I’m very pleased that President Trump has now confirmed he plans to rescind it,” US Senator Ted Cruz (R-Texas) said during a Senate committee hearing to discuss AI regulation on Thursday.
Cruz said he will soon introduce a new bill that “creates a regulatory AI sandbox.” OpenAI CEO Sam Altman, AMD CEO Lisa Su, Microsoft vice chair and president Brad Smith and CoreWeave CEO Michael Intrator testified during the hearing.
The curbs, which were set to take effect on May 15 and were introduced during the final days of former President Joe Biden’s administration, sorted countries into three tiers subject to specific AI-related trade regulation.
Those in the top tier, which include the United Kingdom, Spain, Japan, Germany and Ireland among other countries, face the least restrictions, while countries like China and Russia are in the tier with the strictest constraints. It’s the countries that fall in between that have raised concern among critics like Microsoft.
Microsoft’s Smith wrote in February that countries that fall into this second bucket may look elsewhere for AI, potentially China.
“The unintended consequence of this approach is to encourage Tier Two countries to look elsewhere for AI infrastructure and services,” he wrote. “And it’s obvious where they will be forced to turn.”
AI chip giant Nvidia has also publicly pushed back against the curbs.
The Trump administration has pushed for less regulation around AI, with Vice President JD Vance saying that “excessive regulation of the AI sector” could “kill a transformative industry just as it’s taking off” during remarks at the Artificial Intelligence Action Summit in Paris. Trump is also pushing for the US to be a leader in both the AI industry and in technology manufacturing, frequently touting vows from TSMC and Apple to expand their US infrastructure as victories.
The year kicked off with the arrival of Chinese tech startup DeepSeek’s supposedly cheap yet sophisticated AI model, shaking both Wall Street and Silicon Valley and escalating the US-China rivalry in AI. It grabbed headlines in January for the company’s claims that its R1 model could roughly match OpenAI’s o1 model for a fraction of the price, challenging the notion that powerful performance required costly investments.
This story is developing and will be updated.
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