Malaysia Imposes Trade Permits on US AI Chips

Malaysia has introduced a new requirement for trade permits on high-performance artificial intelligence (AI) chips originating from the United States. This move, as reported by the Wall Street Journal, is part of Malaysia's response to the recent imposition of a 25% tariff by the US on Malaysian exports, effective August 1.

The Malaysian Ministry of Investment, Trade, and Industry (MITI) announced that the permits are necessary for all exports, transshipments, and transits of these AI chips. This decision aims to close regulatory gaps and prevent illegal trade activities, particularly in light of concerns about chips being rerouted to China.

MITI has stated that any individual or company involved in the movement of these chips must notify Malaysian authorities at least 30 days in advance if the items are not listed on the Strategic Items List (SIL). This initiative is part of Malaysia's broader strategy to ensure compliance with international trade obligations and to avoid potential secondary sanctions.

The Malaysian government has emphasized its commitment to maintaining a secure and transparent trading environment, warning of strict legal action against any attempts to circumvent these new regulations. This development follows reports of advanced Nvidia chips being shipped from Singapore to China via Malaysia, prompting increased scrutiny from both Malaysian and US authorities.