Washington: In a decisive move to tighten export control enforcement, the United States has begun installing location tracking devices on select shipments of advanced AI chips to ensure they are not diverted to China or other restricted destinations. According to a Reuters report citing sources with direct knowledge of the policy, the trackers will be deployed only on shipments under investigation and are intended to detect illegal diversions in real time.
Officials believe the technology will bolster legal action against individuals and companies profiting from violations of US export laws. The step underscores Washington’s heightened caution in safeguarding AI semiconductor technology an area central to global tech competition. Historically, US law enforcement has used similar tracking tools on sensitive exports like aircraft parts. Their application to semiconductors now signals the growing strategic importance of these chips in both economic and military contexts.
The White House and members of Congress are reportedly considering proposals that would require US chipmakers to embed location verification technology directly into AI chips as an added safeguard. The move comes amid wider US efforts to limit China’s access to cutting-edge semiconductors, with similar restrictions placed on Russia following its invasion of Ukraine.
China has sharply criticized these measures, accusing Washington of attempting to suppress its technological rise. US authorities have pointed to recent smuggling cases to justify the tighter controls. In January, Reuters revealed a sophisticated AI chip smuggling network operating through Malaysia, Singapore, and the UAE. Just this month, two Chinese nationals in California 28-year-old Chuan Geng of Sade and 28-year-old Zhiwei Yang of El Monte were arrested for allegedly shipping billions of dollars’ worth of Nvidia AI chips and other restricted technology to China between October 2022 and July 2025 without proper licenses.
For the US, the message is clear: the semiconductor race is no longer just about innovation it’s about control, compliance, and closing every possible backdoor.