Reports indicate U.S. Congressman and physicist Bill Foster is set to propose a new law that would impose a requirement on leading AI chip manufacturers like Nvidia to incorporate a geographic location reporting system into their products. This system, as described by Reuters, would determine the general location of an AI chip at the country level using existing and readily available technology. Such attempts are directed towards improving the measures needed to fight the smuggling of these sensitive technologies. The information cites two informants on the issue, claiming Alphabet Inc. employs a similar method to monitor the whereabouts of its Tensor AI chips within all its data centers, thus countering a range of security and theft risks.
Scope of Export Controls and Smuggling
Within the overarching framework of U.S. export controls on China, the proposal comes to life. The White House has placed bans on the export of sophisticated chips to China for both the Biden and Trump administrations since 2022. To some degree, the justification is meant to throttle China’s access to critical technology and safeguard America’s leadership position in AI-based technologies. Reportedly, Washington has recently added these export restrictions to previously permitted chips, like the MI308 and H20. Such a shift is said to have cost AMD $800 million and Nvidia $5.5 billion. In any case, these bans and sanctions have been criticized for not fully achieving their intended goal, which is stemming the flow of chips into China. As Gina Raimondo, the former U.S. Secretary of Commerce, put it, “a fool’s errand.” The claimed source illustrates how some Chinese companies have been able to illegally import sophisticated chips into mainland China. Along with this, the firm DeepSeek, which is said to be one of the most advanced AI models in China, was allegedly involved in the utilization of illegally purchased Nvidia AI chips.
Moreover, it has been reported that a U.S. Senate probe discovered the Bureau of Detectives and Security (BIS), the branch handling export controls, to be grossly understaffed and to be operating based on good faith compliance from the.
Foster’s Proposed Tracking Solution
Representative Foster’s proposed bill aims to tackle what he perceives to be a gap in enforcement in the current export control of AI technology. His plan attempts to address the problem with a system where AI chips must interact with a secure server computer whenever they go online. As one source described, the delay between the chip sending the communication and the server receiving it is more than enough to estimate the chip’s rough location. Reuters reports independent experts who were brought in to help say the plan from the congressman, who served as a particle physicist at Harvard University before obtaining his doctorate there, was found feasible and would likely function as designed to monitor the movement of chips.
Geo-Blocking: Moving the Goalposts
The Illinois congressman is quoted expressing that he wants the legislation to go beyond location tracking. He also wishes for the chips to be instructed in such a way that they geo-block exports, shutting down or disabling operation if they determine that they do not hold the required export licenses. He was quoted claiming, “We can have more detailed discussions with the actual chip and module providers,” suggesting that the module and chip design can be modified easily, even if geo-blocking is far more difficult than location tracking. He went on to describe the ability to disable functionality as vastly more complicated than inferring communication timing when trying to pinpoint the chip’s location.
Support and Concerns
Having geo-block features embedded directly into chips is bound to raise concerns, especially when it comes to privacy and the level of reported location accuracy. Regardless, the law is said to still have bipartisan agreement, which is uncommon in the US Congress; it consists of constituents from both ends who adopt the principle of further tightening the controls placed on AI chip exports. This signals that regardless of industry concerns or public privacy worries, there seems to be a strong political consensus to further investigate chip smuggling and enforce compliance with export control laws.
