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Taiwan to criminalise AI chip smuggling to China

Taiwan is adding AI servers and cutting-edge chips to its list of export-controlled items. According to Bloomberg on October 16, unauthorised shipments of that hardware to China will then become a criminal offence under the Foreign Trade Act.

By: Mikola Máté Patrik · · 2 min read

Illustration of abstract chip outlines on a dark green gradient
Image: AI-generated illustration / Neural Daily

The plan

Economic Affairs Minister Kung Ming-hsin told Bloomberg that AI servers and advanced semiconductors will join the controlled-items list, and once the rules take effect, shipping restricted AI hardware to China will be a crime under the Foreign Trade Act (Bloomberg).

Kung said some measures will correspond to US rules because of commitments in the Agreement on Reciprocal Trade signed this year. He did not say when the measures will be implemented (CNBC TV18 / Bloomberg).

Why now

The US has long restricted Chinese purchases of NVIDIA and AMD AI chips, yet hardware still reaches China via a black market. US officials have alleged that billions of dollars' worth of NVIDIA hardware has made it to China in recent years.

Today, unauthorised AI chip exports to China are not a crime in Taiwan; suspected smugglers can only be charged under other laws. Trade outlet Chip Dispatch reports the rules may cover all Chinese buyers above performance thresholds rather than only blacklisted entities, though detailed thresholds have not been published.

Key takeaways

  • Taiwan will make AI servers and advanced chips controlled items.
  • Unlicensed shipments to China become a crime; no effective date yet.
  • The move ties to commitments in Taiwan's trade deal with the US.
  • Bloomberg describes it as among the strictest tech-security measures of the Lai administration.
  • Nothing changes directly for European buyers, but the global AI hardware supply chain keeps tightening.

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