The US has removed a major trade barrier to the sale of advanced artificial intelligence (AI) chips, known as the “AI Diffusion Rule”, that was introduced in the closing days of the Biden administration and had been harshly criticised by companies including Nvidia, Microsoft and Oracle.

The rule, announced in January 2025, placed broad limits on the number of chips that could be sold to countries around the world, including US allies, in an effort to crack down on means by which Chinese companies could gain access to advanced processors.

Nvidia praised the move, saying it would give the US a “once-in-a-generation opportunity to lead the next industrial revolution”.

‘Inclusive’

The US Commerce Department said it would pursue a “bold, inclusive strategy” with allies while “keeping the technology out of the hands of our adversaries”.

The revocation was criticised by China hawks in the US government, however, who said it opens a greater risk that Chinese companies could gain access physically to AI chips or use their capacity via cloud systems operated in countries such as the United Arab Emirates.

White House AI adviser David Sacks met with Sheikh Tahnoon bin Zayed Al Nahyan, the UAE’s national security adviser and brother of the country’s president, this week amidst a tour of the Middle East by US president Donald Trump.

The House Select Committee on China has long warned of the ties of G42, an Emirati AI company, with Huawei Technologies and other Chinese companies.

“We raised concerns about G42 last year for this very reason – and we need safeguards in place before more agreements move forward,” said Representative John Moolenaar, the top Republican on the panel, on social media.

Microsoft formed a deal with G42 in April 2024 that required the company to break off its existing relations with Huawei, in what the White House called a “positive development”.

Emirati deal in works

The current administration is considering a deal that could send hundreds of thousands of US-designed AI chips to the Emirati company, the New York Times reported this week.

Some of the chips would go to a partnership G42 has with OpenAI, while others could go to G42 directly, with limited oversight, the report said.

This week Nvidia and AMD both announced major deals with Humain, a new AI company backed by Saudi Arabia’s sovereign wealth fund.

Nvidia said it would send 18,000 of its newest “Blackwell” chips to the company, while AMD said it had formed a $10 billion (£7.5bn) collaboration with the company.

Nvidia said under new deals it would be sending hundreds of thousands of AI chips to Saudi Arabian firms.

Qualcomm said it had signed a memorandum of understanding to build a data centre processor for Humain.