China's Commerce Ministry drafts export controls on AI models, agents and chip design

China's Ministry of Commerce, working with the Ministry of Industry and Information Technology, published a draft plan on October 16, 2026 that would restrict the export of technology used in AI models, AI agents and chip design.

The draft adds 40 technologies across the AI, biomedicine and photovoltaics sectors to China's list of items prohibited or restricted from export, and the public comment period runs until mid-November 2026.

What it is

The instrument is a draft amendment to China's catalogue of technologies prohibited or restricted from export, released jointly by the two ministries.

A temporary registration requirement for exports of the covered technologies is already in force while the draft moves toward formal adoption.

What it requires

The export of leading AI models trained on sensitive Chinese data, as well as advanced AI agents used in areas such as critical digital infrastructure, defence and government services, would be restricted under the draft rules.

The draft also covers technologies used to design advanced processing and memory chips, packaging and networking equipment, and the restrictions would mainly target transfers of the underlying technology rather than finished products.

Open-weight models would be exempt if they were made publicly available and had not been trained on sensitive data.

However, the rules would allow restriction on the transfer of technology used in such open-weight models if they surpassed 2tn parameters or were ranked top among global peers by performance.

Simpler approval procedures would apply to Chinese companies building and operating AI data centres overseas, manufacturing their own chip designs abroad, conducting research with foreign partners or helping set international standards.

The commerce ministry said the proposed controls would ban access to AI models trained on sensitive core data, but would not affect indirect access to other Chinese AI models from overseas, for example through apps or websites.

The ministry added that the key distinction is whether restricted technology is being transferred from China to another country.

The draft follows earlier reporting that Chinese regulators had met with top AI and chip firms, including about limiting transfer of training data and model weights, before the formal catalogue amendment was issued.

What security leaders should do

Security and compliance leaders at multinational AI vendors, model providers and chip-design firms with China operations should inventory which models, agents and chip-design workflows could qualify as trained on sensitive core data or exceed the 2tn-parameter threshold described in the draft, since those assets may trigger review before any cross-border transfer, acquisition or personnel move. Teams should also track whether planned overseas AI data centre builds, offshore chip-design manufacturing, or joint research with foreign partners fall under the simplified approval track, and watch for the finalized catalogue text after the comment period closes, since obligations and exemptions described in the draft could change before formal adoption.