US AI chip export controls on China, as the official texts say

The United States controls which AI chips can be sold to China through rules written by the Commerce Department's Bureau of Industry and Security (BIS). Since 2022 the rules have tightened, then partly loosened. In January 2026, newer chips such as the Nvidia H200 moved from "presumed denied" to case-by-case review, with conditions attached.

This timeline is built from official documents: BIS press releases, a BIS final rule, Federal Register records and BIS guidance notes, checked as of 19 October 2026. It explains the jargon as it goes, shows what each rule actually says, and marks what remains unconfirmed. It does not take a side on whether the controls are wise.

Key numbers at a glance

• 17 October 2023 (BIS press release): BIS announced updates to the 7 October 2022 chip controls, with the chip rule effective 16 November 2023.
• 22 (BIS, October 2023): the number of arms-embargoed countries, plus Macau, facing a presumption of denial for advanced chips under that package.
• 2 December 2024 (BIS press release): controls on 24 types of chipmaking equipment, 3 types of software tools, and a set of high-bandwidth memory (HBM) controls.
• 140 (BIS, December 2024): entities added to the Entity List in that package, plus 14 modifications to existing entries.
• 13 May 2025 (BIS press release): the AI Diffusion Rule, issued 15 January 2025, was announced as rescinded, and BIS said it would not enforce it.
• 21,000 (BIS final rule, 15 January 2026): the "total processing performance" ceiling for chips eligible for case-by-case review to China and Macau.
• 6,500 GB/s (same rule): the "total DRAM bandwidth" ceiling for the same group.
• 50 percent (same rule): the cap on aggregate shipments to China and Macau, measured in total processing performance against the same product shipped for US end use.
• 31 May 2026 (BIS guidance): BIS restated that a license is required for advanced chips going to companies headquartered in China, Macau or other Country Group D:5 destinations, wherever those companies sit.
• 7 April 2026 (BIS home page): the timeline for "Approved IC Designer" applications was extended to 31 December 2026.
• 36,184,680 dollars (BIS press release, 17 June 2026): the civil penalty Bosch agreed to pay over unlicensed shipments to Huawei, an Entity List party.
• 9 percent (TSMC 2025 annual report): the share of TSMC's net revenue that came from China, by customer headquarters, in 2025.

First, the vocabulary

Export controls here sit inside the Export Administration Regulations, usually shortened to the EAR. A few terms come up again and again.

ECCN stands for Export Control Classification Number. It is the code that says what a product is for control purposes. The advanced AI chip entries in the BIS texts cited here are 3A090 and 4A090.

TPP means "total processing performance." It is a number BIS uses to measure how much arithmetic a chip can do, weighted by the precision of the arithmetic. A higher TPP means a more capable AI chip.

Total DRAM bandwidth is how fast a chip can move data in and out of its attached memory, measured here in gigabytes per second. AI chips are often limited by memory speed rather than raw arithmetic, so BIS counts it.

Presumption of denial means the licensing officer starts from "no" and the applicant must overcome that. Case-by-case review means no starting presumption either way. Neither phrase is a promise of approval.

Entity List is a BIS list of named companies and institutions that need a license for items covered by the EAR, with stricter treatment than the general rules.

Foreign direct product rule (FDP) extends US jurisdiction to some items made abroad when they are the direct product of certain US technology or software. This is why a chip made outside the United States can still fall under US rules.

Country Group D:5 is the EAR's list of countries under a US arms embargo. China is in it. Macau is treated alongside it in these rules.

October 2022 and October 2023: the first framework

The October 2022 rules are the starting point. The original 2022 announcement is not summarised here; the facts below come from the October 2023 BIS press release, which describes itself as an update to the 7 October 2022 controls.

In the October 2023 package, BIS said it changed how chips are measured. Interconnect bandwidth stopped being a criterion. A chip became controlled if it exceeded either the existing performance threshold or a new "performance density" threshold, which BIS said was meant to head off workarounds such as splitting capability across many smaller chips.

BIS also created a notification route, called License Exception NAC, for certain chips just under the threshold. For exports to Macau and arms-embargoed destinations, the US government would have 25 days to decide whether a license was needed.

The most consequential change was geographic in a different sense. BIS established a worldwide license requirement for controlled chips going to any company headquartered in an arms-embargoed country or Macau, or whose ultimate parent is. The location of the buyer's office stopped being the test. The location of the company's headquarters became the test.

The same package added 13 entities in total to the Entity List, involved in developing advanced computing chips, and extended chipmaking equipment license requirements to 21 further arms-embargoed countries beyond China and Macau.

December 2024: memory, equipment and the Entity List

On 2 December 2024, BIS announced a second large package. According to its press release:

• New controls on 24 types of semiconductor manufacturing equipment and 3 types of software tools used to develop or produce semiconductors.
• New controls on high-bandwidth memory, covering US-origin HBM and foreign-produced HBM that falls under the advanced computing FDP rule, with a new License Exception HBM for certain items.
• 140 additions to the Entity List and 14 modifications, covering tool makers, chip fabrication plants and investment companies.
• Two new FDP rules for equipment, one tied to destinations in Macau or Country Group D:5 and one tied to Entity List parties carrying a specific footnote, plus a "de minimis" provision reaching foreign-made items that contain any amount of US-origin integrated circuits.
• Effective on announcement, with a delayed compliance date of 31 December 2024 for certain controls.

HBM matters because it is the stacked memory that sits beside modern AI processors. Without enough of it, a fast processor sits idle. That is why memory rules sit alongside chip rules.

January 2025 to May 2025: the AI Diffusion Rule comes and goes

On 15 January 2025, the outgoing administration issued the AI Diffusion Rule, a framework that set worldwide licensing for advanced chips by country tier. The BIS press release of 13 May 2025 says its compliance requirements were due to take effect on 15 May 2025.

On 13 May 2025, BIS announced it would rescind the rule, would publish a regulation formalizing that, and would issue a replacement later. Under Secretary Jeffrey Kessler told BIS enforcement officials not to enforce it. The press release said BIS "will issue a replacement rule in the future" and gave no timetable. The Federal Register record for the January 2025 rule lists a related entry titled "Rescinding: Framework for Artificial Intelligence Diffusion". As of 19 October 2026, BIS has not announced a replacement rule on its home page, so treat the replacement as unconfirmed.

The same announcement carried three pieces of guidance. They matter for China because they describe what BIS expects companies to avoid:

• Using certain advanced chips made by Chinese companies, including specific Huawei Ascend chips, can risk violating US export controls.
• US companies should guard supply chains against diversion tactics.
• Allowing US chips to be used to train or run Chinese AI models carries potential consequences.

What the Huawei guidance actually says

The BIS guidance dated 13 May 2025 is more careful than headlines suggested. It says the use of certain Chinese advanced chips "risks violating" US export controls, because those chips were likely developed or produced in violation of the rules. It rests on General Prohibition 10, which bars selling, using, servicing or otherwise dealing with an item when you know a violation has occurred or is about to.

The illustrative list names the Huawei Ascend 910B, 910C and 910D. BIS says the list is not exhaustive. It also says BIS will not pursue enforcement against parties that obtain such a chip solely for technical analysis, such as destructive testing.

So the text is a warning about risk and knowledge, not a flat statement that any use anywhere is illegal. Companies that want certainty are told to confirm with suppliers that authorization existed for the design files and the chips.

December 2025 to January 2026: H200 class chips and the new conditions

The 15 January 2026 BIS final rule, published at 91 FR 1684 and effective on publication, is the main change to China licensing policy in the documents covered here. Its title is "Revision to License Review Policy for Advanced Computing Commodities." BIS's press release of 13 January 2026 says it follows an 8 December 2025 announcement by President Trump that H200 class products could ship to approved customers in China.

The rule changes the policy for exports from the United States to China and Macau from presumption of denial to case-by-case review, but only for chips that meet all of these tests:

• A TPP below 21,000 and total DRAM bandwidth below 6,500 GB/s. The rule names the Nvidia H200 and AMD MI325X as examples.
• The chip is commercially available in the United States when the rule is published.
• The exporter certifies there is enough US supply, so that no US customer order for advanced chips is delayed, and that global foundry capacity will not be diverted from US customers to make the China-bound product.
• Aggregate shipments of the product to China and Macau will be no more than 50 percent of the total shipped for US end use. In the regulatory text this is measured as aggregate TPP, counted from when the product started shipping to US commercial customers.
• The buyer uses rigorous know-your-customer procedures and screens against unauthorized remote access.
• Every shipment is reviewed before export by a qualified third-party testing lab in the United States. The rule says the lab must be headquartered in the United States and must have no ownership or financial stake in the exporter or the buyer, and BIS may revoke a lab's qualification at any time.
• The applicant lists remote end users located in, or owned by parents in, Belarus, China, Cuba, Iran, Macau, North Korea, Russia and Venezuela.
• If the buyer runs a cloud service, sold as Infrastructure as a Service (IaaS), the applicant must verify that it will not pass model weights trained on the chips to undisclosed users, and will not give prohibited parties remote access to algorithms trained on them.
• The application must state each chip's TPP, total DRAM bandwidth, interconnect bandwidth, co-packaged DRAM capacity and peak power, and how many units have shipped to US customers.

The rule is explicit about what it did not relax. Exports to entities headquartered in Macau or Country Group D:5, wherever located, stay at presumption of denial. Reexports and in-country transfers within those destinations also stay at presumption of denial. BIS justified the change by saying it was necessary to ensure the national security benefits of US leadership in AI. The rule was issued without prior notice and comment. It cites Section 1762 of the Export Control Reform Act of 2018 (ECRA), which exempts such export control actions from the Administrative Procedure Act's notice, public comment and delayed effective date requirements.

The remote access conditions matter because AI chips do not have to travel to be used. A company can rent processing time on chips housed in another country over the internet. The rule therefore looks past the delivery address to who will log in, which is a theme that runs through every BIS package since 2023.

In the BIS press release, Under Secretary Kessler is quoted: "Export controls should evolve with changes in technology, while protecting national security."

May 2026: a reminder about headquarters

On 31 May 2026, BIS issued guidance after receiving questions about whether the 2023 headquarters based requirement was still enforced following the AI Diffusion Rule's rescission. The answer was yes. A license requirement continues to apply to advanced computing items going to entities headquartered in, or with an ultimate parent in, Country Group D:5 or Macau, even when those entities are located elsewhere. The guidance says this requirement was first introduced on 17 November 2023, through an end-user control in section 744.23(a)(3) of the EAR. The October 2023 press release gave 16 November 2023 as the effective date of the chip rule; the one day difference is in the official texts themselves.

The guidance adds that bona fide operators of data centers who are otherwise acting consistently with the EAR are not required to stop ongoing use, storage, disposal or servicing of such items because of the guidance, until BIS says otherwise. It also points to the voluntary self-disclosure route in section 764.5 of the EAR.

Enforcement: what a penalty looks like

Rules matter in practice through enforcement. On 17 June 2026, BIS announced that Robert Bosch GmbH agreed to pay a civil penalty of 36,184,680 dollars. According to the press release, Bosch exported about 72.4 million dollars of MEMS sensor products and automotive software to Huawei and its affiliates between 16 September 2020 and 26 September 2024 without a required licence. The items were subject to the EAR under the foreign direct product rule, and Huawei is on the Entity List. Bosch filed a voluntary self-disclosure and cooperated. It separately agreed with the Department of Justice to disgorge profits, and BIS suspended about 3.6 million dollars of its penalty as credit for that payment.

The case is not about AI chips. It is included because it shows how the foreign direct product rule and the Entity List work together: a non-US company shipping non-US products can still need a US licence when US technology is involved and the buyer is listed. David Peters, Assistant Secretary of Commerce for Export Enforcement, said Bosch "had several opportunities to avoid these violations".

How the rules reach the supply chain

TSMC, the chip maker, describes the effect in its 2026 annual report on Form 20-F. It says that in October 2022 and October 2023 the US adopted export controls over certain advanced computing integrated circuits, that in January 2025 the US issued further rules, and that it may need an export license before shipping certain products. It also states that its China fab faces license requirements for acquiring certain manufacturing tools. These are the company's own risk statements, not findings about any customer.

In its 2025 annual report, TSMC says 9 percent of its 2025 net revenue came from China, calculated mainly by where customers are headquartered. That is TSMC's total business, not only AI chips.

On the Chinese side, a Yahoo Finance article of 30 April 2026 reported, citing IDC figures via Reuters, that Chinese chipmakers delivered 1.65 million AI chips in 2025 and held 41 percent of China's AI server market, and it cited an unnamed source saying Nvidia's China share fell from 95 percent before the controls to under 60 percent. These are third-party estimates relayed second hand. Treat them as indications, not measurements.

What is firm and what is uncertain

Firm, because the texts say so:

• The thresholds, conditions and effective date of the January 2026 rule.
• The headquarters based license requirement, as restated on 31 May 2026.
• The content and caveats of the May 2025 Huawei guidance.
• The numbers in the October 2023 and December 2024 press releases.

Uncertain or not confirmed:

• Whether licenses under the January 2026 rule have been granted, how many, and whether chips have shipped. BIS has not published figures.
• How China has responded to the rule in practice. Official Chinese statements are outside the scope of this timeline.
• Whether a formal replacement for the AI Diffusion Rule exists. BIS promised one in May 2025.
• Whether the rule has been amended or challenged since 15 January 2026. Later amendments are not reviewed here; check the Federal Register.
• Market share and shipment figures, which are third-party estimates.

What to watch next

• New BIS guidance or amendments, which the agency publishes on its own site and in the Federal Register.
• Any official data on licenses granted under the case-by-case policy.
• Changes to the Entity List, which can alter who a chip maker can sell to within days.
• Company filings from chip makers and foundries, which describe how the rules affect them in their own words.
• The 31 December 2026 deadline for Approved IC Designer applications, which BIS extended on 7 April 2026.
• Further Chinese domestic chip progress. See China's domestic AI chips and the wider look at AI chip market share.

For a wider view of which countries can buy which chips, including the UAE change of July 2026, see AI chip export controls explained.

For readers who run software teams, the practical link is indirect. Hardware rules shape cloud capacity and prices over time, a theme covered in OpenAI's compute commitments. Teams that want to know which open source components are inside their own applications can run the free scan at https://gold.safeguard.sh/scan.

Quick check

Sources

• BIS press release, 13 January 2026: Department of Commerce revises license review policy for semiconductors exported to China
• Federal Register record, document 2026-00789, 91 FR 1684, 15 January 2026
• Federal Register record, Framework for Artificial Intelligence Diffusion, 90 FR 4544, 15 January 2025
• BIS press release, 17 June 2026: Robert Bosch GmbH to pay 36 million dollar penalty over shipments to Huawei
• Bureau of Industry and Security home page, Approved IC Designer timeline note
• BIS final rule 2026-00789, "Revision to License Review Policy for Advanced Computing Commodities" (public inspection copy, scheduled for publication 15 January 2026)
• BIS guidance, 31 May 2026: enforcement of license requirements for advanced computing items for entities headquartered in Country Group D:5 and Macau
• BIS guidance, 13 May 2025: application of General Prohibition 10 to PRC advanced computing integrated circuits
• BIS press release, 13 May 2025: rescission of the AI Diffusion Rule
• BIS press release, 2 December 2024: Commerce strengthens export controls to restrict China's capability to produce advanced semiconductors
• BIS press release, 17 October 2023: Commerce strengthens restrictions on advanced computing semiconductors and semiconductor manufacturing equipment
• TSMC Form 20-F for 2025, filed 16 April 2026 (SEC)
• TSMC 2025 annual report, chapter 2
• Yahoo Finance, 30 April 2026: Chinese GPU maker Cambricon's Q1 revenue (IDC and Reuters figures as relayed)

Last reviewed: 19 October 2026.