U.S. Commerce Department closes loophole that allowed export of advanced Nvidia and AMD chips to Chinese entities located outside China

On Sunday, the U.S. Commerce Department posted new guidance to enforce license requirements for advanced chips (such as Nvidia's Rubin and Blackwell processors and AMD's MI350x) to entities headquartered in China, even when located outside China. The move closes a year-old opening created when the Trump administration announced in May 2025 it would not enforce the AI Diffusion rule from the Biden administration.

For nearly a year, overseas subsidiaries of Chinese AI firms in places like Malaysia may have been able to purchase advanced chips without a license. One chip industry source estimated hundreds of thousands of chips were exported during this period.

The new guidance does not require data centers to stop using the chips or cut off servicing of advanced computing items such as servers.