Nvidia CEO Jensen Huang, right, speaks alongside President Donald Trump about investing in America, at the White House in Washington, on April 30, 2025.
Jim Watson | AFP | Getty Images
Nvidia shares rose on Wednesday as the Trump administration prepared to rescind what’s known as the “AI diffusion rule,” effectively stopping a set of artificial intelligence chip controls from taking effect later this month.
A Department of Commerce spokesperson confirmed the plan to CNBC after Bloomberg reported on it earlier.
“The Biden AI rule is overly complex, overly bureaucratic, and would stymie American innovation. We will be replacing it with a much simpler rule that unleashes American innovation and ensures American AI dominance,” a Department of Commerce spokesperson said in a statement.
The rule, which was proposed in the last days of the Biden administration, organizes countries into three different tiers, all of which have different restrictions on whether advanced AI chips such as those made by Nvidia, Advanced Micro Devices and Intel can be shipped to the country without a license.
The chip restrictions were scheduled to take effect on May 15.
“We welcome the Administration’s leadership and new direction on AI policy,” an Nvidia spokesperson said in a statement. “With the AI Diffusion Rule revoked, America will have a once-in-a-generation opportunity to lead the next industrial revolution and create high-paying U.S. jobs, build new U.S.-supplied infrastructure, and alleviate the trade deficit.”
Chipmakers including Nvidia and AMD have been against the rule.
AMD CEO Lisa Su told CNBC on Wednesday that the U.S. should strike a balance between restricting access to chips for national security and providing access, which will boost the American chip industry.
Nvidia CEO Jensen Huang said earlier this week that being locked out of the Chinese AI market would be a “tremendous loss.”
