US expands use of location trackers for AI chip shipments to China

The U.S. government is quietly expanding its enforcement toolkit for AI chips by placing location-tracking devices in a targeted subset of shipments to China, a move officials say is aimed at curbing illicit diversions while drawing sharp resistance from the technology industry. The trackers are reportedly installed in servers containing advanced Nvidia and AMD processors, supplied by firms such as Dell and Super Micro, and are not present in every shipment. The effort is designed to trace the journeys of high-risk goods, build cases against those who move chips unlawfully, and strengthen compliance with export controls that were tightened in 2022.

Officials describe the trackers as a measured, strategic tool within a broader export-control regime. They can be concealed inside packaging or embedded within the servers themselves, sometimes accompanying larger devices on shipping boxes. The operation is believed to involve the Bureau of Industry and Security, with potential coordination from Homeland Security Investigations and the FBI. While the precise scope and frequency of use remain undisclosed, the program represents a notable escalation in enforcement activities as...