US threatens sanctions on Chinese AI models over IP theft

US Treasury Secretary Scott Bessent signaled potential sanctions against open-source AI models, accusing Chinese developers of creating low-cost systems using stolen US intellectual property. In an interview on Fox Business on Tuesday, Bessent stated that while the administration supports open-source models, it does not support IP theft, and that the US has the ability to sanction overseas models that steal from American companies. This marks an escalation in US-China tech tensions, building on existing export controls on advanced chips and AI technology. The threat targets the growing competitiveness of Chinese AI models, such as those from DeepSeek, which have gained attention for their efficiency and low cost. Bessent's comments come amid broader US efforts to maintain technological leadership and protect national security interests.

Global Impact

Politically, this threat deepens US-China tech decoupling, potentially triggering retaliatory measures from Beijing that could disrupt global semiconductor supply chains. Economically, sanctions on Chinese AI models would hit Chinese tech firms' revenue and R&D, while boosting US AI companies' market share in the West.