Closing Loopholes for the Overseas Use and Development of Artificial Intelligence Act

To prohibit support for the remote use or cloud use of integrated circuits listed under Export Control Classification Number 3A090 and 4A090 of the Export Administration Regulations by entities located in the People’s Republic of China or Macau. 1. Short title This Act may be cited as the Closing Loopholes for the Overseas Use and Development of Artificial Intelligence Act CLOUD AI Act 2. Findings Congress makes the following findings: (1) The People’s Republic of China, the Russian Federation, and other adversarial countries have taken actions to undermine global stability as well as the United States national security and foreign policy objectives. (2) China has used commercially available civilian technology to modernize its military forces in a policy known as military-civil fusion. (3) As part of its policy of military-civil fusion, China is working to modernize its nuclear, chemical, missile, and biological weapons capacity. (4) The United States and its allies have long regulated items and activities that support the development, production, or use of otherwise commercial items if those items are aid in the development, production, or use of nuclear, chemical, missile, or biological weapons. (5) Artificial intelligence tools could be used to support the development, production, or use of nuclear, chemical, missile, or biological weapons or enhance the destructive capabilities of those weapons. (6) Advanced semiconductors and supercomputer components such as graphics processing units can be used to develop or train artificial intelligence tools and models. (7) In October 2022, the Department of Commerce promulgated export control rules to prevent the export of advanced semiconductors and supercomputer components to China or Macau. (8) Notwithstanding these controls, recent reporting indicates that though entities located in China and Macau can no longer purchase and import advanced semiconductors and supercomputer components because of the October 2022 export controls, Chinese entities are still developing artificial intelligence tools and models by purchasing remote and cloud access to these same advanced components to train artificial intelligence models and tools. 3. Prohibition on support for remote use or cloud use of integrated circuits listed under Export Control Classification Number 3A090 and 4A090 of the Export Administration Regulations by entities located in the People’s Republic of China or Macau (a) In general Not later than 180 days after the date of the enactment of this Act, the Secretary of Commerce shall prohibit United States persons and United States subsidiaries from providing support for the remote use or cloud use of any integrated circuit listed under Export Control Classification Number 3A090 and 4A090 of the Export Administration Regulations by an entity located in the People’s Republic of China or Macau. (b) Regulations The Secretary of Commerce shall issue such regulations as may be necessary to carry out this section. (c) Definitions In this section— (1) the term Export Administration Regulations (2) the term support (3) the term United States person U.S. Person (4) the term United States subsidiary U.S. Subsidiary

Summary: Closing Loopholes for the Overseas Use and Development of Artificial Intelligence Act or the CLOUD AI Act This bill prohibits certain transactions between a U.S. person (i.e., natural person or entity) and an entity located in China or Macau when the transactions support remote access to certain integrated circuits. Specifically, the bill prohibits a U.S. person (and any foreign branch of a U.S. person) from providing support to an entity in China or Macau for the remote or cloud use of integrated circuits covered by export control classification numbers 3A090 or 4A090. (The classification numbers cover certain high-performance integrated circuits, computers, electronic assemblies, and related components.) The bill directs the Department of Commerce to establish the ban no later than 180 days after the bill is enacted and to issue the regulations necessary to implement the bill.