Taiwan to tighten AI chip export controls to China to align with the U.S.

Taiwan is preparing to tighten its export controls on artificial intelligence chips to bring them more closely in line with US restrictions, a senior official in Taipei told Bloomberg. The move adds to the Trump administration's crackdown on the smuggling of advanced semiconductors into China.

According to Economic Affairs Minister Kung Ming-hsin, Taipei wants to add AI servers and cutting-edge semiconductors to its list of controlled items. Once the measures take effect, shipping restricted AI hardware to China will become a criminal offense under the Foreign Trade Act. Kung declined to say when the new rules will be applied.

Kung said some of the measures on controlled items will mirror those of the US, because Taiwan made commitments under the Agreement on Reciprocal Trade it signed with the US this year. He made the remarks in an interview on October 12.

The US has long restricted sales of Nvidia and AMD AI chips to China. Even so, Chinese companies have managed to obtain those accelerators through a sophisticated black market. According to the article, US officials maintain that billions of dollars' worth of Nvidia hardware has reached China in recent years.

Taiwan does not currently treat the unauthorized export of AI chips to China as a crime. Authorities warn potential sellers that they could be violating US rules. However, the only legal avenue in the island's courts is to charge suspected smugglers with violations of other existing local laws.

If approved, the measures would be among the toughest taken by President Lai Ching-te's administration to defend Taiwan's technological and national security interests. Taipei is thus testing how far it can go with firmer policies while managing pressure from US officials on several fronts. Lai had already said Taiwan would address US concerns about export controls, without giving details. Bloomberg reported earlier this year that local authorities were exploring additional legal tools that would allow them, for the first time, to criminally prosecute AI chip smuggling to China.

Kung is one of the officials in charge of Taipei's economic relationship with Washington, a relationship that helps counterbalance Beijing. This week, the minister also discussed plans to raise billions of dollars to develop industrial parks in the US. The goal is to create a foundation for a complete domestic supply chain in the country for Nvidia and other AI hardware makers.

Note: the text received is a short Bloomberg article. This summary is limited to what that text contains. There are no details on the specific list of controlled products, the planned penalties or the implementation timeline.