Taiwan prepares tighter AI-chip export controls on China, with criminal penalties

Shipping restricted AI hardware from Taiwan to China would become a criminal offense under the Foreign Trade Act once measures Taipei is preparing take effect, Economic Affairs Minister Kung Ming-hsin told Bloomberg News. The government is preparing tighter export controls, rather than describing restrictions that have already entered into force.

Kung outlined the proposed scope: Taiwan plans to add AI servers and cutting-edge semiconductors to its controlled-items list. That puts two forms of hardware within the proposed rules: the advanced chips themselves and the assembled computing systems that contain them. The planned listings are the step Kung identified before the criminal provisions would apply.

The preparations would align Taiwan’s export controls more closely with US restrictions. Bloomberg’s October 16 report places them within the Trump administration’s clampdown on smuggling advanced semiconductors to China. The US restrictions on AI-chip exports to China date to 2022, according to Investing.com’s account, carried by Yahoo Finance.

Indirect shipments, an existing dispute

Nvidia chips have reportedly continued to reach China through smuggling routes in Southeast Asia despite US restrictions, Investing.com wrote. Those routes involve an intermediate destination rather than a direct shipment to China. They illustrate why the ultimate destination of hardware, not simply its first overseas stop, matters to the diversion problem.

Beijing has already objected to the US restrictions, Investing.com noted. That opposition concerns the existing American rules; it is not a reported response to Kung’s proposed listings. Taiwan’s preparations would bring its own controls closer to a policy China has previously resisted.