NVIDIA has issued a strong statement against the Biden Administration’s recently introduced “AI Diffusion” rule, labeling it as a significant threat to global innovation and economic growth.

The company argues that the new regulation could undermine decades of U.S. leadership in computing and software ecosystems, which have historically driven technological progress and strengthened American influence worldwide.

According to NVIDIA, the groundwork for the current dominance of U.S. artificial intelligence (AI) capabilities was laid during the first Trump Administration, which encouraged an environment of innovation free from overregulation. This approach, the company states, enabled AI to become a transformative force across industries such as healthcare, agriculture, and manufacturing, contributing to economic growth domestically and internationally.

However, NVIDIA claims the Biden Administration’s rule, developed in secrecy and spanning over 200 pages, seeks to impose sweeping regulatory controls on the design, marketing, and sale of semiconductors, computing systems, and software. The company argues that this move constitutes a “bureaucratic overreach” that could derail progress in AI, stifle competition, and squander the technological advantage the U.S. has built over decades.

NVIDIA further criticizes the rule for its purported ineffectiveness in addressing U.S. security concerns, stating that it targets widely available mainstream technologies, such as those used in gaming PCs and consumer hardware. "Rather than mitigating any threat, the new Biden rules would only weaken America’s global competitiveness," the company remarked, adding that the measures could harm innovation and economic prospects at home and abroad.

The statement concludes with a call for policies that support American leadership through innovation and competition rather than restrictive measures. NVIDIA expressed hope for a return to strategies that bolster the economy, maintain U.S. leadership in AI, and ensure the nation’s competitive edge in the global tech arena.

The Semiconductor Showdown: U.S.- China Chip Conflict Intensifies

Over the past year, the United States has ramped up efforts to restrict China’s access to advanced semiconductor technology, citing national security concerns.

The Biden Administration imposed stringent export controls on AI chips and added over 140 Chinese companies to its trade blacklist, including prominent players like Naura Technology Group. These measures aim to curb Beijing's technological and military advancements while safeguarding the U.S.'s position in the global tech hierarchy.

Additionally, the U.S. has targeted major Chinese firms such as Tencent and CATL, citing alleged military ties, and has pressed allies like Japan and the Netherlands to limit exports of advanced chip-making equipment to China.

In response, China has taken steps to counteract these restrictions, imposing export bans on critical materials such as gallium and germanium—key components in semiconductor manufacturing—thereby disrupting global supply chains.

Simultaneously, Chinese firms are stockpiling foreign chip-making equipment and seeking alternative alliances to mitigate the impact of U.S. measures. Beijing has also doubled down on efforts to bolster its domestic semiconductor capabilities, striving to reduce dependency on Western technology and maintain its competitiveness in the global tech race.