United States announces new export controls on AI compute technology that will affect Israeli AI industry.

On January 13, 2025, the Biden Administration and the U.S. Department of Commerce's Bureau of Industry and Security announced new controls targeting advanced computing chips and certain closed artificial intelligence model weights. The announcement included new license exceptions and updates to the Data Center Validated End User authorization program. Depending on whether President-Elect Donald Trump opts to overturn the rule, it could have extensive implications for the Israeli AI industry and other nations worldwide.

The new regulations impose restrictions on the export of AI chips that will affect numerous countries around the world, including Israel. These restrictions limit the extent of AI computing power that countries may obtain from the United States without a license. To implement these controls, the administration has divided the world into three tiers of countries based on their relationship to U.S. interests and national security concerns.

Israel is classified as a second-tier country alongside approximately 150 others. While AI chip exports to these second-tier nations remain permitted, they will be subject to strict limitations. The primary goal of the regulation is to limit the ability of China and other adversarial nations to develop advanced AI technology, though the tiered approach means that allied nations like Israel face some export constraints as well.