US gives UAE a fast lane for AI chips and defense tech

The US Commerce Department is opening the door wider for the UAE to buy advanced American chips, satellites, and defense equipment. The US Commerce Department’s Bureau of Industry and Security is moving the UAE into Country Group A:5, giving the Emirati government and approved commercial entities broader access to license exceptions for sensitive US exports, according to a Federal Register filing (pdf).

The chip angle is the headline: The UAE government and approved companies can now access certain advanced computing items license-free — consistent with the May 2025 US-UAE AI cooperation framework. The new status also eases exports of military equipment, commercial satellites and spacecraft, and dual-use technology tied to oil and gas, desalination, and civil nuclear power.

Who gets the green light? G42 and Core42 are listed as approved UAE-based recipients for advanced computing items. US-headquartered AI companies operating in the UAE — including Amazon, Apple, Google, Meta, Microsoft, OpenAI, Oracle, and xAI — are also covered. MGX gets a softer landing too: the Commerce Department plans to “favorably review” chip and server license applications for the UAE-headquartered company.

SOUND SMART- Country Groups are how BIS sorts destinations by export-control risk. A:5 is reserved for close US allies — mostly Nato members — who qualify for the widest set of license exceptions. Moving out of D:3 and D:4, which cover chemical/biological and missile-technology restrictions, and into A:5 is as much a trust signal as a trade one.

Why now? The Commerce Department points to decades of US-UAE cooperation on Iran and its proxies, the UAE’s 2024 Major Defense Partner designation, and the May 2025 critical-tech agreement covering AI and semiconductors. The geopolitical backdrop is not subtle: the filing says the UAE “played a key role advancing US interests” during Operation Epic Fury, the US-Israeli strikes on Iran that began in February.

IN CONTEXT- The tech angle has been building for a while: The two countries last year announced plans for a 5 GW data center complex in Abu Dhabi as part of a wider USD 200 bn investment agreement, while the UAE joined the US-led Pax Silica supply-chain initiative earlier this year. G42 has also been building its US footprint. The Abu Dhabi AI group previously said it planned to invest tens of bns of USD in US AI applications, cloud computing, and data centers. Its Core42 unit is now expanding its Lake Mariner AI infrastructure site in New York to 60 MW, with AMD and Nvidia infrastructure being added after earlier US export approval for Nvidia chips.

An honorable mention goes to the defense angle too: The US and the UAE are major defense partners, and the easing of exports lands at a time when the UAE’s doubling down on bringing more defense capabilities home and diversifying its defense supply chains. The US-Iran conflict exposed the economics problem: Iranian drones costing as little as USD 20k-100k were being intercepted with systems costing USD 3-12 mn a shot, analysts previously told EnterpriseAM.

One caveat: This is not a blanket free-for-all. G42 and Core42’s approval for license-free advanced computing access automatically expires after 270 days absent further BIS notice, and the filing keeps end-use and end-user controls in place. BIS also says it maintains an export-control officer presence in the UAE and works with local authorities to monitor sensitive US goods and technology moving through the country’s logistics network.

The UAE is taking the W: UAE ambassador to the US Yousef Al Otaiba said in an embassy statement the move “opens new doors” for joint R&D, deeper tech cooperation, expanded trade, and a stronger defense partnership.

Not everyone in Washington is cheering: Democratic Senator Elizabeth Warren criticized the move, saying it gives G42 license-free access to advanced AI chips and promises favorable treatment for MGX “despite reported concerns” about diversion of sensitive tech to China and other national security risks, Reuters reports. That’s despite G42 earlier divesting from Huawei and severing ties with Chinese tech firms to secure the partnership with the US and clear the path for American chip exports.

Watch this space: This gives the UAE more room to build the hardware layer behind its AI, data-center, defense, space, and energy ambitions — but only for entities Washington is willing to trust. The next test is who gets added to the approved list and how quickly chip and server flows actually move.