Nvidia spy allegations likely to spur laws to tighten China's access to AI chips

The measures are the AI Overwatch Act, which would give Congress power over advanced chip exports, the Chip ​Security Act, which would require businesses to track their chips to combat smuggling, and the Match Act, which ⁠would push US allies to restrict more chipmaking equipment to China.

Nvidia is considered the biggest opponent of both the Chip Security ​and AI Overwatch acts, who had direct contact with the company over several months. Until the US Department ​of Justice brought indictments tied to chip smuggling last year, Huang and Nvidia had argued there was no such smuggling.

The company said it complied with export laws. Nvidia declined to comment. The House Foreign Affairs Committee advanced all three bills earlier this year.

They are now in the Senate National Defense Authorization Act ​management package. In a joint statement on Monday, Democratic Senator Elizabeth Warren of Massachusetts and her Republican colleague Jim Banks of Indiana said ​that "Nvidia CEO Jensen Huang's confirmation of a relationship with a suspected spy for China's intelligence service makes these national security concerns even more urgent.

"They ‌added: "It is ⁠time for Congress to take decisive action to pass key bills like the AI Overwatch Act in the NDAA that will cut off pathways through which China accesses advanced chips. "In March, the senators had urged the Department of Commerce to suspend or reconsider Nvidia's export licenses to China and conduct a full security review.

Democratic Representative Bill Foster of Illinois echoed the senators’ sentiments. “Congress has the tools to prevent ​powerful AI chips from getting ​in the wrong hands and ⁠posing a national security risk,” Foster posted on X on Monday, in response to news of Huang’s affair.

He said the Chip Security Act he introduced with Republican Representative Bill Huizenga of Michigan had ​passed unanimously out of committee in the House. “It’s time to get it across the finish line,” ​he said.

"The hurdle these ⁠bills need to clear is getting the White House onboard," said Chris Mac. Kenzie, a spokesman for Americans for Responsible Innovation, a Washington nonprofit organization that favors the measures. "With everything that's surfaced, it would be costly for the White House to back Nvidia in a fight with Congress ⁠over ​restricting Chinese access to chips.

"The White House did not comment on the measures. The Information ​Technology Industry Council, whose members include Nvidia, among other groups, has opposed the measures, arguing they could undermine US competitiveness and complicate export control policy.

A spokeswoman ​for the council declined comment on the current Nvidia situation.