Washington Investigates Chinese Access to Sanctioned Nvidia Accelerators via Foreign Data Centers

According to Bloomberg, US officials have launched an investigation into Chinese access to advanced AI accelerators in foreign data centers, which are currently not subject to US export controls but are banned for direct shipment to China. The probe was prompted by the rapid progress of Chinese AI companies, with some estimates suggesting they lag behind Western models by only a few months. Specifically, the investigation focuses on how Chinese developers like Moonshot AI, which recently released the Kimi 3 model, manage to use Nvidia's Blackwell architecture accelerators, which are prohibited for export to China, likely by accessing computing power in other countries. The US Commerce Department's unit overseeing this issue is compiling a list of countries hosting such data centers. Formal violations may not have occurred, but officials are concerned, and potential mechanisms to restrict remote access are being considered. Nvidia, which benefits from continued access, may lobby against new restrictions. Alibaba, for instance, rents data centers in Malaysia through a Singapore-based subsidiary, illustrating the opacity of these arrangements.