Nvidia claims that the GAIN AI Act could hinder competition, likening it to the AI Diffusion Rule.

The AI GAIN Act, introduced as part of the National Defense Authorization Act, aims to limit China's ability to obtain high-end technology, particularly advanced artificial intelligence (AI) chips. This legislation seeks to restrict the export of such chips to foreign entities, a move that could significantly impact global competition in the AI industry.

The AI GAIN Act shares similarities with the AI Diffusion Rule, both designed to prioritize American needs and ensure domestic access to advanced chips. If passed into law, the AI GAIN Act would enact new trade restrictions mandating exporters to obtain licenses and approval for the shipments of silicon exceeding certain performance caps. Specifically, the Act targets AI chips with a total processing power of 4,800 or above.

Nvidia, a prominent player in the AI industry, has expressed concerns that the AI GAIN Act would restrict global competition for advanced chips. The company believes the proposed bill would not only impact the AI industry but would also restrict competition worldwide in any industry that uses mainstream computing chips. Nvidia, in a deal with President Donald Trump last month, agreed to give the government a cut of its sales in exchange for resuming exports of banned AI chips to China.

The AI GAIN Act is also similar to the AI Diffusion Rule in its approach to prioritizing American interests. The AI Diffusion Rule put limits on the computing power countries could have and allocated certain levels of computing power to allies and other countries. Fears surrounding the AI GAIN Act are that China would use AI capabilities to supercharge its military.

The AI GAIN Act is designed to guarantee access and innovation for national artificial intelligence. It stipulates that AI chipmakers prioritize domestic orders for advanced processors before supplying them to foreign customers. This could potentially boost the domestic AI industry and support national artificial intelligence development and innovation.

However, the name of the legislator who introduced the GAIN AI Act into the National Defense Authorization Act remains unknown. The exact implications of the AI GAIN Act on the U.S. leadership and economy, as well as global competition, are yet to be seen. The AI GAIN Act and the AI Diffusion Rule both aim to restrict the export of advanced artificial intelligence chips to foreign entities, particularly China, and their impact on the global tech landscape is a topic of ongoing discussion.

Nvidia claims that the GAIN AI Act could hinder competition, likening it to the AI Diffusion Rule.