BIS AI Chip Loophole Closure Disputed — Hundreds of Thousands of Advanced Chips May Have Entered China via Singapore/Malaysia Subsidiaries

TechTimes and Tom's Hardware reported on June 6 that the US Bureau of Industry and Security (BIS) had formalized guidance confirming that advanced AI chip export licenses are required for any entity whose ultimate parent is headquartered in China — regardless of where the subsidiary is physically located. The clarification closes a loophole that reportedly allowed Chinese tech giants to purchase Nvidia Blackwell GPUs, AMD MI350x accelerators, and HBM memory through Singapore and Malaysia-registered subsidiaries. Tom's Hardware reported that hundreds of thousands of advanced AI chips may have entered China through this blind spot, representing a significant gap in the export control architecture BIS spent years building. Trump administration officials publicly disputed that the loophole had ever existed — in stark contrast to BIS's own June 1 guidance, which implicitly acknowledged the gap by granting a grace period to companies that had already acquired chips through subsidiaries before the clarification. Senators Elizabeth Warren and Andy Kim separately criticized the administration for the enforcement gap, characterizing the guidance as a belated and incomplete response to a structural vulnerability that had been exploited at scale. The controversy arrives as Senator Warren's June 8 deadline for Nvidia CEO Jensen Huang to confirm Senate Banking Committee testimony (June 11) is imminent. The BIS loophole story operationalizes Warren's concern: if Chinese-parented subsidiaries in Singapore could freely order Blackwell GPUs, then the efficacy of the entire US export control regime is called into question. Simultaneously, China's domestic response continues: Huawei Ascend chips completed full-parameter post-training of DeepSeek V4-Pro (June 5), demonstrating that China no longer needs Nvidia access for frontier model development — the geopolitical import of any chips that did enter via the loophole is therefore primarily historical, not operational, for frontier AI capability.