MALAYSIA INVESTIGATES CHINESE FIRM'S USE OF NVIDIA AI CHIPS

Malaysia's trade ministry is digging into reports that a Chinese company is using servers equipped with Nvidia's advanced AI chips to train large language models in local data centers.

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The probe focuses on whether the firm's actions break Malaysian laws or regulations, particularly those tied to sensitive technology.

The ministry is working with agencies like police and customs to verify the claims, emphasizing a firm stance against any violations.

The investigation stems from a report that Chinese engineers transported hard drives filled with data to Malaysia, aiming to build AI models using Nvidia-powered servers. These servers, housed in Malaysian data centers, rely on chips subject to U.S. export controls designed to limit China's access to advanced AI technology. Malaysia, a hub for semiconductor manufacturing, must navigate its role as a regional tech player while ensuring compliance with local and international rules.

The ministry clarified that Nvidia's AI chips and related servers aren't classified as controlled goods under Malaysian law, giving data centers flexibility in their commercial decisions. However, any attempt to bypass export controls, whether Malaysian or foreign, is illegal. The government is coordinating with international partners to monitor sensitive tech flows, signaling a broader effort to prevent Malaysia from becoming a loophole in global trade restrictions.

THE NVIDIA CHIP CONTROVERSY

Nvidia's AI chips, like the H100 and A100, are critical for training large language models, powering everything from chatbots to advanced analytics. These chips are in high demand globally, but U.S. restrictions limit their export to certain countries, including China, to curb strategic and military applications.