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U.S. weighs closing the cloud loophole that let Chinese AI firms access banned Nvidia computing power

8/19/2026

A loophole, meaning a gap in a rule that permits what the rule was written to prevent, is now at the center of a test for U.S. export controls on advanced semiconductors.

The United States has banned Nvidia's most capable chips from being shipped to China.

Chinese AI companies have reportedly accessed equivalent computing power anyway, using servers located outside China that run on the restricted hardware.

Lawmakers are now examining whether to close that cloud-access gap. Export controls are the legal tools Washington uses to restrict which American-made technology can reach foreign buyers.