U.S. Extends AI Chip Export Ban

The United States Department of Commerce announced on June 1, 2026, that its restrictions on advanced artificial intelligence (AI) chip shipments apply to subsidiaries of Chinese companies located outside of mainland China. This clarification addresses concerns regarding potential loopholes in Washington's export control regime, specifically targeting businesses with headquarters or a parent company in China.

The Bureau of Industry and Security (BIS), under the Commerce Department, issued guidance affirming that licensing requirements for AI chip exports extend to all entities with Chinese ownership, regardless of their operational location. This move follows the Trump administration's decision to scrap the Biden administration's proposed Framework for Artificial Intelligence Diffusion, which aimed for a global licensing regime for AI chips.

Nvidia, a major AI chip manufacturer, stated that its sales and vetting processes already align with these clarified rules, requiring licenses for controlled products shipped to Chinese-headquartered companies. The guidance aims to prevent Chinese companies from acquiring export-controlled chips through foreign subsidiaries, reinforcing U.S. efforts to limit China's access to advanced AI technology.