Type to search

US Plans New Rules for Cloud Firms to Cut Off China AI Access

The US is pushing to require its cloud firms to verify the identity of foreign entities who sign up for their services, through a “know-your-customer” program

Amazon Web Service's cloud service logo is seen in this image
Amazon Web Service's cloud service logo is seen in this image. Image: Reuters


The US has proposed new rules for American cloud companies that would require them to verify the identity of foreign entities who sign up for their services, through a “know-your-customer program.

“We can’t have non-state actors or China or folks who we don’t want accessing our cloud to train their models,” United States Secretary of Commerce Gina Raimondo said in an interview with Reuters.

“We use export controls on chips,” she noted. “Those chips are in American cloud data centres so we also have to think about closing down that avenue for potential malicious activity.”


Also on AF: TSMC, Samsung May Bag Billions in Subsidies for US Chip Fabs


The proposed “know your customer” regulation was released on Friday for public inspection and will be published on Monday.

“It is a big deal,” Raimondo said.

The Customer Identification Program would also set minimum standards for identifying foreign users and would require cloud computing firms to certify compliance annually.

Raimondo said US cloud computing companies “should have the burden of knowing who their biggest customers are training the biggest models, and we’re trying to get that information. What will we do with that information? It depends on what we find.”


‘Denying’ China ability to train AI

The Biden administration is taking a series of measures to prevent China from using US technology for artificial intelligence, as the burgeoning sector raises security concerns.

The United States is “trying as hard as we can to deny China the computing power that they want to train their own (AI) models, but what good is that if they go around that to use our cloud to train their models?” she said.

Last month, Raimondo said the US will not allow Nvidia “to ship its most sophisticated, highest-processing-power AI chips, which would enable China to train their frontier models.”

The US government is worried about China developing advanced AI systems on a variety of national security grounds. It has taken several steps to stop Beijing from receiving cutting-edge US technologies to strengthen its military.



View this post on Instagram


A post shared by Asia Financial (@asiafinancial)


‘Illegal’ executive order on AI

US President Joe Biden in October signed an executive order requiring developers of AI systems that pose risks to US national security, the economy, public health or safety to share the results of safety tests with the US government before they are released to the public.

The Commerce Department plans to soon send those survey requests to companies. Raimondo said companies will have 30 days to respond.

“Any company that doesn’t want to comply is a red flag for me,” she said.

Carl Szabo, general counsel at NetChoice, a tech industry trade group, said Commerce is implementing Biden’s “illegal” executive order “to force industry reporting requirements for AI.”

He added that requiring US cloud companies to report use of their resources by non-US entities “for training large language models could deter international collaboration.”

Top cloud providers include Amazon.com’s AWS, Alphabet’s Google Cloud and Microsoft’s Azure unit.


  • Reuters, with additional editing by Vishakha Saxena


Also read:

Slower Nvidia Chip Out in Q2 But China Firms ‘Don’t Want It’

Nvidia to Stop Some AI Chip Exports to China Immediately

China’s Military, AI Bodies Still Buying Nvidia Chips Despite US Ban

China Firms Rush to Poach Nvidia Clients With AI Chip Offerings

US Curbs Set Off Sales, Tech Boom for China Chip Equipment Firms

US Chip Export Ban Seen as Big Opportunity for Huawei

Threat of More Chip Curbs Spurs Warnings on China Innovation

Western Spy Chiefs Warn China Using AI to Steal Tech Secrets

White House: US, China Need to Collaborate on AI Safety – Inc



Vishakha Saxena

Vishakha Saxena is the Multimedia and Social Media Editor at Asia Financial. She has worked as a digital journalist since 2013, and is an experienced writer and multimedia producer. As a trader and investor, she is keenly interested in new economy, emerging markets and the intersections of finance and society. You can write to her at [email protected]


AF China Bond