US may block corporate AI tie-ups with China

A humanoid robot at the China International Robot Show in Shanghai last year. Major US technology firms have activities in China ranging from research labs to training initiatives, often in collaboration with Chinese companies and institutions which
A humanoid robot at the China International Robot Show in Shanghai last year. Major US technology firms have activities in China ranging from research labs to training initiatives, often in collaboration with Chinese companies and institutions which are major customers. PHOTO: REUTERS

Technology's military potential leads to concern over links with Chinese companies, scientists

NEW YORK • The US government may start scrutinising informal partnerships between American and Chinese firms in the field of artificial intelligence (AI), threatening practices that have long been considered garden variety development work for technology firms, sources have said.

So far, US government reviews for national security and other concerns have been limited to investment deals and corporate takeovers.

This possible new expansion of the mandate is being pushed by members of Congress, and those in President Donald Trump's administration who worry about theft of intellectual property and technology transfer to China, said four people familiar with the matter.

AI, in which machines imitate intelligent human behaviour, is a particular area of interest because of the technology's potential for military usage, they said. Other areas of interest for such new oversight include semiconductors and autonomous vehicles, they added.

These considerations are in early stages, so it remains unclear if they will move forward, and which informal corporate relationships this new initiative would scrutinise.

Any broad effort to sever relationships between Chinese and American tech companies - even temporarily - could have dramatic effects across the industry.

Major US technology firms, including Advanced Micro Devices, Qualcomm, Nvidia and IBM, have activities in China ranging from research labs to training initiatives, often in collaboration with Chinese companies and institutions which are major customers.

Top talent in areas including AI and chip design also flows freely among companies and universities in both countries.

For example, when US chipmaker Nvidia - the leader in AI hardware - unveiled a new graphics processing unit that powers data centres, video games and cryptocurrency mining last year, it gave away samples to 30 AI scientists, including three who work with China's government, according to Nvidia.

For Nvidia, which gets a fifth of its business from China, the giveaway was business as usual. It has several arrangements to train local scientists and develop technologies there that rely on its chips. Offering early access helps Nvidia tailor products so it can sell more.

The US government could nix this sort of cooperation through an executive order from Mr Trump by invoking the International Emergency Economic Powers Act. Such a move would unleash sweeping powers to stop or review informal corporate partnerships between a US and Chinese firm, any Chinese investment in a US technology firm or the Chinese purchases of real estate near sensitive US military sites, the sources said.

REUTERS

A version of this article appeared in the print edition of The Straits Times on April 28, 2018, with the headline 'US may block corporate AI tie-ups with China'. Print Edition | Subscribe