Trump administration reportedly drafting ban on Chinese datacenter components

The Trump administration is reportedly drafting a ban on US imports of new models of Chinese datacenter components, in the latest sign US authorities are scrambling to respond to the rapid development of AI technology in China.Four people familiar with the matter told Reuters that the Federal Communications Commission (FCC), which oversees the US ⁠telecommunications industry, is developing a measure to bar imports of new ​Chinese optical transceivers, which allow data to travel over fiber-optic cables at the speed of light within datacenters. Officials hope to publish the measure this year, according to Reuters.The FCC could still modify or shelve the restriction, Reuters reported. But the deliberations are the latest example the Trump administration is increasingly focused on limiting Chinese technological incursions into cutting-edge US industries.The US has long been at the forefront of the AI industry, with companies like OpenAI, Anthropic and Google driving the development of models, and chipmakers like Nvidia commanding the chip supply chain.But advancements in China’s Artificial Intelligence, chip manufacturing and robotics technologies have rattled markets, caused divisions among US tech moguls and left the Trump administration scrambling to respond.Chinese companies are some of the biggest manufacturers of components necessary for datacenters, with the country’s optical transceiver industry controlling a majority of the global market for the technology. US tech companies have committed trillions of dollars to build out American AI infrastructure. Plans for that buildout are broadly falling behind schedule, however, while China attempts to catch up with its own massive development of datacenters.Chinese datacenter components are of concern because they could allow Chinese firms to steal ⁠data, install malware or disrupt service in the US if they were embedded in US infrastructure, experts say.Last month, the FCC announced a ban on China’s advanced humanoid robots. The Trump administration is also reportedly mulling whether to restrict the use of Chinese open-source AI models.US officials have cited threats to the US supply chain and fears over national security risks as rationale for those measures. Scott Bessent, the US treasury secretary, has also suggested that China could be sanctioned for theft of US data and intellectual property.The White House and FCC did not respond to requests for comment.The Chinese embassy in Washington told Reuters that Beijing ‌urges the US to “heed the objective and rational voices of the business communities in both countries” and “stop smearing Chinese companies and threatening them with sanctions”.“China will take all necessary measures in response to any action that causes material harm to its interests,” it added.Some Trump administration officials have been citing the example of Huawei, a Chinese telecom company, to argue for the new restrictions. Huawei’s equipment was so deeply embedded in US infrastructure that efforts to remove it were difficult.A US ‌ban on new models of Chinese datacenter devices would probably hit China’s Zhongji Innolight, one of the biggest global sellers of transceivers, which was added to the Pentagon’s list of alleged Chinese military-backed companies in June.