Trump Administration Rescinds Biden’s AI Diffusion Rules
On June 11, 2025, the U.S. Department of Commerce (DOC) officially rescinded the Biden administration’s Artificial Intelligence Diffusion Rule, just days before it was set to be implemented. This decision marks a significant shift in the U.S. government’s approach to regulating the export of AI technology.
Background of the AI Diffusion Rule
The Artificial Intelligence Diffusion Rule was introduced by former President Joe Biden in January 2025. It aimed to establish limits on the export of U.S.-made AI chips to various countries, enhancing existing restrictions for the first time. The rule categorized countries into three tiers:
- Tier 1: Countries like Japan and South Korea, which would face no export restrictions.
- Tier 2: Regions including Mexico and Portugal, which would see chip export limits for the first time.
- Tier 3: Countries such as China and Russia, which would encounter tightened controls.
Announcement of Rescission
On a Tuesday in early June, the DOC announced that it would not enforce the Biden-era regulation, signaling a new direction under the Trump administration. The Secretary of Commerce for Industry and Security, Jeffrey Kessler, stated, “The Trump Administration will pursue a bold, inclusive strategy to American AI technology with trusted foreign countries around the world, while keeping the technology out of the hands of our adversaries.”
Future of AI Regulations
The DOC indicated plans to introduce a replacement rule in the future, suggesting a shift towards direct negotiations with countries rather than implementing blanket restrictions. This change reflects a more flexible approach to international relations regarding AI technology.
Industry Guidance
In lieu of new regulations, the DOC provided guidance for the industry, emphasizing the importance of compliance with existing U.S. export rules. Companies were reminded that using Huawei’s Ascend AI chips anywhere in the world violates these rules. The guidance also warned against the potential consequences of allowing U.S. AI chips to be utilized for training AI models in China and recommended strategies to protect chip supply chains from diversion tactics.
Conclusion
The rescinding of the Artificial Intelligence Diffusion Rule illustrates the ongoing debate over how best to regulate emerging technologies like AI. As the Trump administration prepares to unveil new policies, the tech industry awaits clarity on how these changes will impact the future of AI development and international cooperation.
