Malaysia tightens rules on exports of US-origin AI chips: Report

The new controls are being enforced under the Strategic Trade Act 2010, according to the Ministry of Investment, Trade and Industry (MITI), the Malay Mail reported.

“Malaysia will not tolerate the misuse of its jurisdiction for illicit trading activities,” the ministry said. “MITI remains committed to preserving a safe, secure, transparent and rules-based trading environment with all its trade partners,” including the US.

Last week, Bloomberg reported that the US plans to restrict shipments of advanced AI chips to Malaysia to prevent them from being diverted to China as part of a broader crackdown on semiconductor smuggling.

Despite Malaysia’s previous pledges to tighten import scrutiny, chip exports to the country have surged, drawing US attention and prompting proposed curbs that may include temporary exemptions for American and allied firms operating there.

According to the new requirement, companies and individuals must notify authorities at least 30 days before moving the AI chips if they know or suspect potential misuse or restricted activities.

"This initiative serves to close regulatory gaps while Malaysia undertakes further review on the inclusion of high-performance AI chips of US origin into the SIL (Strategic Items List) of the STA 2010 (Strategic Trade Act)," the ministry said in a statement.

Malaysia has warned that it will take strict legal action against any violations of the Strategic Trade Act 2010 or related laws.

The move came days after US President Donald Trump imposed a 25% tariff on all exports from Malaysia starting from Aug.1.