Senate Banking Committee hearing pushes for stronger export controls on AI chips to block China access

Chairman Scott opened the Senate Banking Committee hearing by framing artificial intelligence as a tool that can boost small businesses and national security but carries risks if poorly governed. "If America leads, AI can help lower costs, improve affordability, expand opportunity, strengthen small businesses, protect our financial system, and keep America secure," he said.

Ranking Member Warren and several senators focused questioning on the risks of advanced AI chips reaching China and the need for enforceable export controls. David Feith, a senior fellow at the Hudson Institute, told the committee that compute — chips and chipmaking equipment — is the decisive choke point in the U.S.-China competition and that current U.S. export-control policy contains gaps and loopholes. "Compute is the lifeblood of AI," he said, and preserving U.S. and allied advantage requires closing those gaps.

Witnesses broadly endorsed pending bills intended to tighten controls and improve enforcement, including the AI Overwatch Act, the Match Act, the Chip Security Act and related legislation. Feith recommended the committee act on a set of complementary bills to strengthen the Bureau of Industry and Security (BIS) and close pathways for diversion and smuggling. Mike Flynn of the Information Technology Industry Council urged better resourcing and oversight of BIS and stressed the value of allied cooperation on export controls.

Senators pressed witnesses on evidence of chip diversion and smuggling to China, citing recent indictments and news reporting. Several members cited concerns that licenses issued for H20 and H200 chips could be exploited; witnesses urged robust enforcement and location-verification measures. "We have seen mounting evidence—news reporting and indictments—of high-end chips being diverted abroad," a witness testified, calling for stronger enforcement paired with diplomatic alignment among allies.

Committee members also debated statutory versus executive action. Multiple senators argued that lawmaking would provide durable authority and reassure allies, while witnesses said statutes and timely diplomacy should work together with executive discretion and stronger administrative capacity at BIS. Several senators asked the committee to move quickly to markup the bills and to support appropriations that strengthen export-control administration.

The hearing concluded with broad bipartisan support for strengthening export controls and enforcement, though members differed on timing and precise tools. The committee adjourned with a call to advance the legislation and increase BIS resources to prevent the transfer of advanced AI chips to adversaries.

The committee did not take a vote at the hearing; senators signaled intent to pursue markups on the bills discussed.