The US has introduced export restrictions on AI chips and GPUs affecting 120 countries, including the UAE, as part of its effort to maintain AI leadership, according to a White House statement and Reuters. The regulations, effective 120 days from publication, divide the world into three tiers of export measures:

  • Tier 1: Includes 18 nations, like Japan, the UK, South Korea, and the Netherlands, which are exempt.
  • Tier 2: Covers 120 countries, including the UAE, subject to export caps. Orders with collective computation power up to 1.7k GPUs remain exempt.
  • Tier 3: Blocks nations such as Russia, China, Iran, and North Korea from accessing advanced AI technology.

The caps: US-headquartered cloud providers such as Microsoft can apply for Universal Verified End User (UVEU) status, allowing them to allocate up to 7% of their global AI computational capacity in non-Tier 1 countries, translating to hundreds of thousands of chips.

Can non-US companies get the goods themselves? Companies outside "countries of concern" meeting security standards can also apply for National Verified End User (NVEU) status, enabling them to acquire up to 320k GPUs over two years. Non-VEU entities can still access up to 50k GPUs per country.

Governments can double chip caps under certain conditions: Countries that sign agreements with the US — aligning efforts in export control, clean energy, and technology security — can double their chip caps to 100k advanced GPUs, per the new rules.

REMEMBER- The US and the UAE are close AI partners: State AI firm G42 secured a USD 1.5 bn investment from Microsoft in April 2024, facilitating large-scale AI component deliveries, including Nvidia chips and GPUs, which began in September. The US recently approved advanced AI chip exports to a Microsoft-run facility in the UAE as part of the partnership with G42 — after the two reached an agreement to prevent access to the facility by personnel from countries with US arms embargoes, or who are on the Bureau of Industry and Security (BIS) Entity List, including China, and to lock the facility down with US defense tech.

The mechanisms for AI exports from the US into the UAE have always been contentious. Concerns that the US might pull the plug on the partnership have been swirling for months, with reports that Pentagon officials are doubting G42’s commitment to fully divest from China, despite reports that it has already sold all its stake in China. G42 said it even removed all China-made hardware from the centers, making “long-term investments” to ensure data protection, and using hardware solely manufactured by Western nations, which swayed US officials to approve exports.

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