In a highly anticipated move, the Trump administration has announced that it will rescind and replace the AI Diffusion Rule issued by the Commerce Department during the last weeks of the Biden administration.  Set to take effect on May 15, the rule intended to govern the global spread of advanced artificial intelligence technology through a new country tiering system, as well as additional controls on the export of high-performing computing chips and certain AI model weights.  From the start, criticisms were raised regarding the rule’s complexity and potential negative impacts on the global competitiveness of U.S. technology companies and their ability to foster international collaborations.  

While there is no official word on when or how the rule will be modified, the administration has indicated that any such changes will better balance U.S. national security and tech industry interests.  That likely means a revised rule that more directly targets China by relaxing restrictions on a number of Tier 2 countries, including Saudi Arabia and the United Arab Emirates.  There is speculation that Commerce is already working on a separate rule to stop countries diverting chips to China, as well as a public advisory warning against training Chinese AI models with advanced U.S. chips.