Taiwan to make shipping AI hardware to China a criminal offence

Taiwan is preparing to make the unauthorised shipment of restricted AI chips and servers to China a criminal offence, in a move that could make it harder for Chinese companies to obtain advanced computing hardware through unofficial channels. The planned restrictions would give Taiwanese authorities a stronger legal basis to prosecute those involved in such shipments. Taiwan currently does not treat unauthorised exports of AI chips to China as a specific criminal offence, forcing prosecutors to rely on other existing laws to pursue suspected smugglers.Taiwan's Minister of Economic Affairs Kung Ming-hsin confirmed the proposed changes in an interview with Bloomberg News. He said the government plans to add AI servers and advanced semiconductors to its list of controlled items. Once the measures take effect, shipping restricted AI hardware to China could lead to criminal charges under Taiwan's Foreign Trade Act. The government has not announced a timeline for implementing the new rules.Why Taiwan wants to tighten AI chip exportsThe proposed changes come as the US continues its efforts to limit China's access to advanced semiconductors used in AI systems. Washington has imposed restrictions on Chinese purchases of advanced AI chips from Nvidia and AMD. However, these measures have not completely stopped the flow of restricted hardware into China. Smuggling networks have reportedly helped Chinese buyers obtain chips despite the export restrictions.US officials have alleged that Nvidia hardware worth billions of dollars has reached China over the past few years. Taiwan's new rules could help authorities pursue people involved in moving restricted AI hardware to China. Until now, officials have warned potential sellers that shipments could violate US rules, but local courts have had to rely on other Taiwanese laws to take action against suspected smugglers. By making these shipments a criminal violation under its own export laws, Taiwan would have a more direct way to prosecute such cases.Taiwan moves closer to US export controlsThe plan also reflects Taiwan's efforts to align its trade policies with those of the US. The two sides signed an Agreement on Reciprocal Trade this year, which included commitments relating to controlled items. "Going forward, some of our measures on controlled items will correspond to American ones because we have made quite some commitments in the Agreement on Reciprocal Trade," Kung told Bloomberg News.He did not provide details about when the restrictions would be introduced or exactly how the new controls would be implemented. President Lai Ching-te has previously said Taiwan would address concerns raised by Washington over export controls, without specifying the measures his government would take.Taiwan is also looking to expand its technology partnership with the US. Kung recently told Bloomberg News that the government plans to raise billions of dollars to create industrial parks in the US. These facilities would help establish a wider domestic supply chain for Nvidia and other AI hardware makers.- Ends