The U.S. Department of Commerce said it will not enforce the AI Diffusion Rule, set to take effect Thursday, which would have capped the number of advanced semiconductors that chipmakers could sell to most countries. (The Logic)

Talking point: The rule—among U.S. President Joe Biden’s last acts in office—sorted the world into three tiers. Sales to allies like Canada weren’t restricted at all, while exports to adversaries like China and Iran were all but banned. It’s the middle group that created challenges for Washington and for chip firms. Countries like India and Saudi Arabia are trying to grow their AI sectors, and need advanced semiconductors for the massive data centres they’re building. The Trump administration has signalled it wants U.S. technology firms to profit from other countries’ AI ambitions. But Washington still wants to control the flow of chips, and the Commerce Department plans to issue a new policy to replace the diffusion rule.