Washington’s AI chip crackdown on China is facing new uncertainty as Trump officials debate whether enforcement gaps may have allowed Chinese companies such as Alibaba 
BABA to legally access servers powered by Nvidia 
NVDA advanced AI chips outside China. After questions surfaced over whether the 2023 restrictions still applied globally, the Commerce Department’s Bureau of Industry and Security issued an unusual Sunday advisory saying the controls remain in effect for Chinese companies worldwide.
The dispute centers on BIS policy decisions in May 2025, when the Trump administration moved away from the Biden-era AI diffusion rule without putting a clear replacement framework in place. Some officials and export-control practitioners believe that may have opened a possible path for server makers using Nvidia and Advanced Micro Devices 
AMD chips to sell into Chinese companies in markets such as Singapore or Malaysia, although BIS says no loophole existed and any unlicensed shipments would have violated US export controls.
The issue matters for investors because it reaches deep into the AI supply chain, touching Nvidia, AMD, Taiwan Semiconductor Manufacturing 
TSM, Samsung Electronics, Tencent (TCEHY), Alibaba, and the broader semiconductor ecosystem driving market expectations. BIS is now considering additional public guidance on foundry due diligence rules, while lawmakers from both parties have raised concerns that unclear enforcement may have possibly weakened Washington’s restrictions on China’s access to advanced AI hardware.
