Beijing regulators are reportedly mulling more stringent export controls on artificial intelligence (AI) and semiconductor technologies.
The Chinese Ministry of Commerce (MofCom) has been in talks with major domestic AI and chipmaking firms, including Alibaba Group Holding Ltd. (NYSE:BABA), ByteDance Ltd., and Zhipu AI, to discuss ways to protect China’s advanced technologies and promising start-ups from Western acquisition, the Financial Times reported on Tuesday.
MofCom is contemplating restricting the transfer of crucial data for training their models overseas and limiting the downloading of their model weights by foreign users, although overseas customers would still have access to the models and services, as per the report.
The ministry is also considering potential restrictions to prevent foreign chipmakers, such as Qualcomm Inc. (NASDAQ:QCOM) and Taiwan Semiconductor Manufacturing Co. (NYSE:TSM), from producing advanced semiconductors based on designs developed by Chinese companies like Huawei Technologies Co., Alibaba, and ByteDance.
According to the report, China may also restrict overseas acquisitions of strategic technology firms, including those in agentic AI, to close loopholes highlighted by Meta Platforms‘ (NASDAQ:META) now-reversed $2 billion acquisition of Manus.
China’s MofCom did not immediately respond to Benzinga‘s request for comments.
China Closes AI Gap With US
This move comes after China’s AI lab Moonshot launched its Kimi K3 model last week, which outperformed Anthropic‘s Opus 4.8 on most benchmarks, highlighting Beijing’s rapid progress in closing the frontier AI gap with the U.S.
Last week, at the 2026 World AI Conference, Chinese President Xi Jinping called for greater international cooperation on AI, saying its development should be a “symphony of global collaboration,” not a “solo performance” by one country.
AI Policy Debate Intensifies
The debate over government intervention in the AI sector is intensifying as Chinese AI models surpass U.S. rivals on OpenRouter, capturing a record 58% of tokens processed by U.S. firms, up from less than 10% at the start of 2025, driven by rapid adoption of models such as DeepSeek.
Anthony Pompliano, CEO of Professional Capital Management, argued against banning Chinese AI models, suggesting that American companies should outperform Chinese rivals through innovation rather than restrictions. His comments were made in response to reports that the Trump administration was considering new limits on advanced Chinese AI models.
Similarly, David Sacks, former White House AI and crypto czar, criticized the use of regulatory uncertainty as a tool to discourage the adoption of Chinese AI models. He argued that AI policy should promote evidence-based decisions and open competition.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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