"U.S. lawmakers have tried four times since September last year to close what they called a glaring loophole: China is getting around export bans on the sale of powerful American AI chips by renting them through U.S. cloud services instead. But the proposals prompted a flurry of activity from more than 100 lobbyists from tech companies and their trade associations trying to weigh in, according to disclosure reports. The result: All four times, the proposal failed, including just last month."
"And time after time, despite bipartisan attempts, Congress has turned a blind eye to loopholes that allow China to work around its own rules, such as cloud services, third-party resellers, and holes in sanctions passed after the Tiananmen massacre. For example, despite U.S. export rules around advanced chips, China bought $20.7 billion worth of chipmaking equipment from U.S. companies in 2024 to bolster its homegrown industry, a report from a congressional committee this month warned."
U.S. lawmakers tried four times since September to close a loophole that lets China circumvent export bans by renting American AI chips through U.S. cloud services. Each proposal failed amid lobbying from over 100 tech industry lobbyists and trade associations. U.S. technology sales to China involve billions and influence future tech dominance. Across five administrations, U.S. officials allowed and sometimes aided American firms in selling technology to Chinese police, government agencies, and surveillance companies. Congress often ignored loopholes such as cloud rentals, third-party resellers, and gaps in sanctions. In 2024 China bought $20.7 billion of U.S. chipmaking equipment despite export rules.
Read at The Mercury News
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