China Considers Export Restrictions on AI Chips and Models, Potentially Impacting Huawei and Alibaba

China’s Ministry of Commerce is reportedly consulting major domestic technology companies on a new package of export restrictions that could significantly reshape the country’s artificial intelligence (AI) landscape. The proposed measures aim to retain AI hardware, software, chips, models, and training data within China’s borders, a move that could paradoxically impact leading Chinese tech firms such as Huawei and Alibaba. The consultations, initially reported by *Financial Times*, suggest a deepening commitment by Beijing to technological sovereignty in AI.

Key aspects of the proposed regulations include prohibiting Chinese chip designers from utilizing foreign semiconductor manufacturers like TSMC (Taiwan) and Samsung (South Korea) for producing integrated circuits. This would force companies to rely solely on domestic manufacturing capabilities, which are currently behind in advanced node production, or strain the capacity of Chinese foundries like SMIC.

Impact on Domestic Tech Giants

The most significant impact of these restrictions would be on companies like Huawei, Alibaba, and ByteDance, which design advanced chips but depend on foreign foundries for their fabrication. Denying access to these global manufacturers could slow their progress in AI hardware development. This strategic shift reflects China’s long-term goal of insulating its AI ecosystem from external dependencies, particularly from the United States.

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AI Model and Data Export Controls

Beyond chip manufacturing, the proposed regulations also target advanced AI models and the data used to train them. The Ministry of Commerce has reportedly discussed with companies like Alibaba, ByteDance, and Zhipu the intention to limit the export of training data outside China. Additionally, restrictions on foreign users downloading the weights of Chinese AI models are being considered. This marks a potential departure from the strategy of some Chinese AI developers, such as DeepSeek, which have openly published model weights as part of their competitive approach against Western AI.

Strategic Technology Acquisitions

The package of restrictions also includes a potential tightening of rules concerning foreign acquisitions of strategic Chinese technology, particularly in areas like agentic AI. This move aims to close perceived legal loopholes, drawing parallels to past interventions, such as the Chinese authorities’ order to unwind Meta’s acquisition of the startup Manus. This indicates a broader effort to safeguard critical AI intellectual property and prevent its transfer abroad.

Broader Implications and Future Outlook

If confirmed, these restrictions would likely be integrated into China’s updated catalog of prohibited or restricted export technologies, similar to existing controls on rare earths and lithium. While the proposals are currently in a consultation phase and no final scope has been confirmed by the involved companies or the Ministry of Commerce, their implementation could create a regulatory paradox. China would be restricting its own companies’ access to advanced chip manufacturing and global AI collaboration in pursuit of technological self-sufficiency, potentially hindering their immediate growth and international competitiveness.

Source: Xataka IA – https://www.xataka.com/empresas-y-economia/china-se-plantea-vetar-tsmc-a-sus-propias-empresas-chips