EU Outcry Over New U.S. AI Chip Limits: GPU Caps Hit Select Nations

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The U.S. administration has recently announced stringent controls on the international distribution of AI chips and GPUs, extending beyond mere purchasing restrictions to dictate their usage locations. This directive has sparked opposition from major industry players like Nvidia and the Semiconductor Industry Association (SIA), and now the European Commission (EC) is voicing concerns as well. The policy is set to be implemented 60 days post-announcement, during Trump’s anticipated second term, which allows the EU and other stakeholders some time to engage in discussions with the U.S. government to possibly postpone or revoke the directive.

Ten European countries—Belgium, Denmark, Finland, France, Germany, Ireland, Italy, the Netherlands, Norway, and Sweden—have been categorized as Tier 1. This status grants them almost unrestricted access to advanced U.S.-made AI chips, although they must comply with American security guidelines and maintain no less than 75% of their processing capabilities within Tier 1 nations. They are permitted to allocate the remainder of their AI chip capabilities in Tier 2 countries, but they must limit this distribution to no more than 7% in any single country, requiring them to expand their operations across multiple nations if needed.

On the flip side, other EU nations fall into Tier 2, facing a strict annual limit of approximately 50,000 GPUs from 2025 to 2027. While the specifics of this restriction remain somewhat vague, companies from Tier 2 countries may seek ‘validated end-user’ status to acquire additional computing power, provided they adhere to U.S. regulations.

The EC has issued a joint statement expressing that they “work closely with the U.S., especially in security matters, and pose an economic opportunity rather than a security threat.” They added, “We look forward to a constructive dialogue with the forthcoming U.S. administration. We are optimistic about finding mutually beneficial solutions to maintain a secure transatlantic supply chain for AI technology and supercomputers, for the advantage of entities and individuals on both sides of the Atlantic.”

It appears that Washington, D.C. has introduced these stringent rules following various reports indicating that previous bans and sanctions have been largely ineffective. This comprehensive prohibition aims to significantly impede Tier 3 nations such as China, Russia, and other sanctioned countries from obtaining AI chips, even through indirect means or illicit channels. Nevertheless, U.S. Commerce Secretary Gina Raimondo has argued that such restrictive measures are misguided, emphasizing that investing in domestic semiconductor manufacturing and research is crucial for the U.S. to maintain its technological supremacy globally.

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