US Senator Tom Cotton has introduced the Chips Security Act, a bill that would mandate location-based tracking for advanced chips, in an effort to stop them from making their way to China.

The US has aggressively worked to restrict China’s access to advanced chips, especially those used for AI development and training. Given the importance of such chips, there have been efforts to bypass those export restrictions, including through third-party companies that legally purchase chips and then sell them to Chinese companies.

Cotton’s bill aims to stop that practice by making it possible to track the chips.

Not later than 180 days after the date of the enactment of this Act, the Secretary shall require any covered integrated circuit product to be outfitted with chip security mechanisms that implement location verification, using techniques that are feasible and appropriate on such date of enactment, before it is exported, reexported, or in-country transferred to or in a foreign country

The bill would also empower the Secretary of Commerce to take the following steps.

• Require a location verification mechanism on export-controlled advanced chips or products with export-controlled advanced chips within 6 months of enactment and require exporters of advanced chips to report to BIS if their products have been diverted away from their intended location or subject to tampering attempts.
• Study, in coordination with the Secretary of Defense, other potential chip security mechanisms in the next year and establish requirements over the next few years for implementing such mechanisms, if appropriate, on covered advanced chips. This longer timeline accommodates the years-long technological roadmap for development of the next generation of advanced chips.
• Assess, in coordination with the Secretary of Defense, the most up-to-date security mechanisms annually for three years and determine if any new mechanisms should be required
• Make recommendations annually for three years on how to make export controls more flexible, thus streamlining shipments to more countries.
• Prioritize confidentiality when developing requirements for chip security mechanisms.

“We must do better at maintaining and expanding our position in the global market, while safeguarding America’s technological edge. With these enhanced security measures, we can continue to expand access to U.S. technology without compromising our national security,” said Cotton.

Cotton’s bill underscores the ongoing trade and technology war between the US and China, with both companies trying to gain or maintain and advantage.