The U.S. Department of Commerce has formally rescinded the AI Diffusion Rule, introduced by President Biden.

The rule would have restricted exports of advanced AI chips and model weights under a tiered system, but faced industry backlash.

The Department said the rule “would have stifled American innovation and saddled companies with burdensome new regulatory requirements,” and directed the Bureau of Industry and Security (BIS) not to enforce it. 

“The Trump Administration will pursue a bold, inclusive strategy to American AI technology with trusted foreign countries around the world, while keeping the technology out of the hands of our adversaries.  At the same time, we reject the Biden Administration’s attempt to impose its own ill-conceived and counterproductive AI policies on the American people,” Under Secretary of Commerce for Industry and Security Jeffery Kessler said.

Simultaneously, BIS issued guidance to tighten export controls on Huawei Ascend chips, caution US firms against supplying chips for overseas AI training or inference, and advise on protecting supply chains.