The US Senate has passed legislation requiring advanced artificial intelligence chipmakers, including Nvidia Corp. and Advanced Micro Devices Inc., to prioritize American customers over China, marking a setback for the industry’s efforts to block the measure. The bipartisan vote, held late Thursday, is part of broader efforts to strengthen US competitiveness in cutting-edge technologies and limit exports to China and other foreign adversaries, Bloomberg reports.
Lead co-sponsor Senator Jim Banks, an Indiana Republican, said the measure is designed to ensure that US companies, including small businesses and startups, are not forced to wait behind China’s tech giants for the latest AI chips. Democratic co-sponsor Senator Elizabeth Warren of Massachusetts echoed the sentiment, emphasizing the legislation’s focus on safeguarding domestic access. US tech leaders and industry groups, however, have criticized the bill, arguing that it could restrict competition and weaken innovation. Nvidia previously stated that the US is its largest market and described the legislation as addressing a non-existent problem. A company official declined to comment Thursday.
The Senate measure was added to the annual defense policy bill after a monthlong stalemate, but its path to becoming law remains uncertain. The House passed its version in September without the export-controls language, meaning lawmakers in both chambers must negotiate a final package that may or may not include the provision. Bloomberg notes that this follows a Trump administration deal earlier this summer in which Nvidia and AMD received eased export restrictions to China, highlighting the tension between national security concerns and commercial interests.
Industry observers say the legislation could have significant implications for the global AI semiconductor market. While intended as a “major win for US economic competitiveness and national security,” according to Brad Carson, president of the AI policy nonprofit Americans for Responsible Innovation, the bill also signals a more interventionist approach to regulating strategic technology flows. Companies like Nvidia and AMD may face operational and logistical challenges if forced to implement priority access systems, potentially reshaping supply chains and affecting global pricing dynamics in the high-demand AI chip sector.
