AMD Reportedly Denied of Selling AI Chip Exclusive to China

US chipmaker Advanced Micro Devices (AMD) Inc. has reportedly received a rejection from the Department of Commerce to sell an artificial intelligence (AI) chip exclusive to the Chinese market as part of the White House’s move to limit exports of such an innovative product to the country.

People familiar with the matter said A Santa Clara-based company attempted to acquire US government approval for the sale of the AI processor to China.

Officials had said no to the proposal because they determined the chip to be ‘too powerful’ despite its performance already having been reduced and being in compliance with US export rules.

The firm also still needs to secure a license from the Commerce’s Bureau of Industry and Security (BIS) before it is able to sell the chip to the world’s second-largest economy.

The semiconductor company has yet to comment on the matter, while the BIS has declined to comment. It has yet to be confirmed whether AMD would file for licensing.

US Chipmakers Still Tapping Chinese Market Despite Sanctions

The US has been implementing measures to curb China’s access to advanced chips that can build AI models and the tools for producing the chips due to concerns over Beijing using such technologies to enhance its military power.

In 2022, US President Joe Biden’s administration introduced a suite of export restrictions, which were further tightened in October last year by adding more technology to the list and prohibiting sales to intermediary countries that might weaken the limits.

The strict policies have prevented US semiconductor giant and major AI player Nvidia Corp. from selling its processor tailored for Chinese customers and aligned with the 2022 export controls.

The company has since created new, less powerful products specifically developed for China to meet the 2023 version of the prohibitions. Commerce Secretary Gina Raimondo has also said she was reviewing the particulars of those components.

AMD’s presence in the country has been fairly checked, although it has increased its efforts in recent months to progress in the market.

However, major Chinese tech firms, including Tencent Holdings Inc. and Baidu Inc., recently indicated that their Nvidia chip supply could last about one or two years of development of their own AI models.