China curbs exports of some AI technologies, could affect TikTok sale in US

The new restrictions could encompass interface technologies used by China's ByteDance.
The new restrictions could encompass interface technologies used by China's ByteDance.PHOTO: REUTERS

BEIJING (BLOOMBERG) - China said it will restrict the exports of some artificial intelligence (AI) technology to "safeguard national economic security", and will require government permits for overseas transfers.

AI interface technologies such as speech and text recognition, and those that analyse data to make personalised content recommendations were added to a revised list of export-control products published on the Ministry of Commerce's website late on Friday (Aug 28).

The new restrictions could encompass technologies used by China's ByteDance, the official Xinhua News Agency reported, citing a trade expert.

Beijing-based ByteDance is being forced by US President Donald Trump's administration to sell the US operations of its popular video-sharing TikTok app.

Microsoft and Oracle have submitted rival bids to ByteDance to acquire TikTok's US business, while Centricus Asset Management and Triller made a last-minute pitch on Friday to buy TikTok's operations in several countries for US$20 billion (S$27 billion), according to a person familiar with the matter.

The changes mean ByteDance  will be required to seek Chinese government approval to sell the US operations of its short-video app, according to a person familiar with the matter.

The new restrictions cover technologies ByteDance uses in TikTok and will require the company to seek government approval for any deal, according to the person, asking not to be identified because the details aren’t public. The new rule is aimed at delaying the sale and is not an outright ban, the person said.

ByteDance should study the new export list and "seriously and cautiously" consider whether it should halt negotiations, Xinhua cited Cui Fan, the trade expert who is a professor at Beijing's University of International Business and Economics, as saying.

The revised rules would cover cross-border transfers of restricted technologies even within the same company, while the impact and consequences of failing to make appropriate applications would be very different if an international business is spun off, Professor Cui said separately in an interview with Bloomberg.

Technologies related to drones and to some genetic engineering methods and procedures were also added to the revised export-control list while others in areas like medical equipment were removed.

The revisions are meant to promote China's technological advancement and international cooperation, and "safeguard national economic security", a commerce ministry representative said in a separate statement on Friday.


Technology exports cover various transfers out of China including via trade, investment and patents, according to the statement.

Any export of restricted technology will require letters of export permit intentions from Chinese authorities before negotiations can be held, while final permits are required before any transfer happens.