The Trump administration’s Department of Commerce (DOC) has officially rescinded the Biden administration’s AI diffusion rules.

The Biden administration approached AI chip exports through a three-tier system, with Tier 1 close allies facing no restrictions, Tier 2 countries subject to moderate restrictions, and Tier 3 countries dealing with the most stringent restrictions. The Trump administration has made no secret of its desire to roll back the Biden administration’s rules, with plans to completely revamp the system.

According to the DOC’s Bureau of Industry and Security (BIS), the three-tier rules have officially been rescinded.

The AI Diffusion Rule was issued on January 15, 2025, with compliance requirements that were set to come into effect on May 15, 2025. These new requirements would have stifled American innovation and saddled companies with burdensome new regulatory requirements. The AI Diffusion Rule also would have undermined U.S. diplomatic relations with dozens of countries by downgrading them to second-tier status.

BIS plans to publish a Federal Register notice formalizing the rescission and will issue a replacement rule in the future.

Under Secretary of Commerce for Industry and Security Jeffery Kessler has instructed the BIS not to enforce the Biden-era rules while the DOC works to implement a replacement.

“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,” said Kessler. “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.”

In the meantime, BIS announced export controls impacting Chinese companies.

• Issuing guidance that using Huawei Ascend chips anywhere in the world violates U.S. export controls.
• Issuing guidance warning the public about the potential consequences of allowing U.S. AI chips to be used for training and interference of Chinese AI models.
• Issuing guidance to U.S. companies on how to protect supply chains against diversion tactics.

Only time will tell how the new AI export rules will shake out, but the Trump administration clearly plans to continue restricting China’s access to advanced chips and technology.