Exporters of AI tech fretting over proposed curbs

US companies may have to obtain licences before selling their products and services to foreign governments or partnering with some researchers in certain countries


AMAZON, Apple, Google, IBM and their peers could be subject to new restrictions on how they export the technology behind voice-activated smartphones, self-driving cars and speedy supercomputers to China under a proposal floated on Monday by the Trump administration.

For the US government, its pursuit of new regulations marks a heightened effort to ensure that emerging technologies - including artificial intelligence (AI) - do not fall into the hands of countries or actors that might pose a national security threat.

The official request for public comment, published in the Federal Register, asks whether a long list of AI tools should be subject to stricter export-control rules. The Trump administration's potential targets include image recognition software, ultrafast quantum computers, advanced computer chips, self-driving cars and robots. Companies that make those products and services, for instance, might have to obtain licences before selling them to foreign governments or partnering with some researchers in certain countries.

The document itself is only an initial notice of rules to come, and the Commerce Department, which is leading the effort, is still deciding how to proceed. But its broad wording, along with the White House's long-running, high-stakes trade rift with Beijing, left some tech experts fearful that it could result in greater market barriers for companies doing business in China. They also worry that any rule could adversely affect US investment and research in AI.

"If you think about the range of products this potentially implicates, that's massive. This is either the opening of a big negotiation with the industry and the public, or a bit of a cry for help in scoping these regulations," said David Edelman, director of the Project on Technology, the Economy, & National Security at the Massachusetts Institute of Technology.

"We've seen the China trade war is a political football," said Mr Edelman, a former top tech aide to President Barack Obama, adding: "Surprises are not off the table here."

The Commerce Department explicitly said that it hopes to protect national security without "hampering the ability of the US commercial sector to keep pace with international advances".

The rules come at the request of Congress, which authorised them as part of a recently passed defence bill. In its proposal, the Trump administration said that it is focused "at a minimum" on countries already subject to a US arms embargo, a category that includes China.

The potential limits on AI research and exports reflect a growing apprehension with Beijing's investment in that industry.

In December 2017, for example, the White House's official National Security Strategy warned that "risks to US national security will grow as competitors integrate information derived from personal and commercial sources with intelligence collection and data analytic capabilities based on artificial intelligence and machine learning".

What the Trump administration is "trying to control is the flow of know-how or research or development that enables" high-tech capabilities, said Melissa Duffy, an export-control expert and partner at the law firm Dechert LLP.

Some in the tech industry worry that the regulations could widen an existing trade rift between Washington and Beijing. Many executives at big tech companies have bristled at White House-backed tariffs on China, fearing that Beijing's retaliation could result in higher costs for them - or higher prices on components for their products. Others simply do not want to anger Beijing, which controls one of the world's largest markets for tech devices.

To that end, Silicon Valley's lobbyists have been scrambling to digest what the new proposal would mean for their industry at a time when US firms are racing their Chinese counterparts to dominate the market for AI.

"We view this as a really important process that our industry is taking very seriously and plan to engage in, because the outcomes are of great consequence for us," said Christian Troncoso, a policy director at BSA The Software Alliance, a Washington, DC-based trade group for companies including Apple, Microsoft, IBM and Oracle. WP

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes