Commerce drafts rule to shut China's remote AI-chip access

The Trump administration's Commerce Department is drafting a rule that would block Chinese AI firms from renting Nvidia GPU compute through data centers in third countries such as Thailand and Singapore, The Information reported, with a draft that could be shared with trade groups as early as September.

The gap the rule aims to close is that U.S. export controls cover the physical chip but not remote access to it. Chinese hyperscalers including ByteDance, Alibaba and Tencent have reportedly tapped Nvidia compute via other Asian nations, including Thailand, Malaysia and Japan. Tencent open-sourced Hy4-preview, a 770-billion-parameter MoE with a 1M-token context, on August 29.

The legal footing is thin. An attorney at Baker McKenzie told The Information it is 'widely acknowledged' within the export-control bar that Commerce cannot enforce a regulation on remote access to chips under existing law. The Remote Access Security Act, which would give the Bureau of Industry and Security that authority, passed the House 369-22 in January and now sits in the Senate Banking, Housing, and Urban Affairs Committee.

The proximate case cited by the administration is Moonshot AI. White House OSTP director Michael Kratsios has publicly alleged that Moonshot acquired GB300-equipped servers and accessed the same system in Thailand to help train Kimi K3, a 2.8 trillion parameter model. Kratsios also alleged Moonshot developed a 'sophisticated internal platform to conduct large scale distillation against U.S. models,' switching between access channels to avoid detection. Moonshot has not publicly responded to the accusations.

Commerce could have leaned on know-your-customer checks under the Biden-era Foundry Due Diligence Rule, but the Trump administration rescinded the wider AI Diffusion framework in May 2025 and has said it won't enforce that diligence rule. The draft now circulating is, in effect, an attempt to rebuild a narrower version of that guardrail without the underlying statute yet in place.