(Reuters) – The U.S. government has approved the export of advanced artificial intelligence chips to a facility operated by Microsoft in the United Arab Emirates as part of the company’s highly-prized partnership with Emirati AI firm G42, Axios reported on Saturday, citing two people familiar with the deal.
Microsoft (NASDAQ: ) invested $1.5 billion in G42 earlier this year, giving the U.S. company a minority stake and a board seat. As part of the deal, G42 would use Microsoft’s cloud services to run its AI applications.
The deal, however, came under scrutiny after US lawmakers raised concerns that the G42 could transfer powerful US AI technology to China. They requested a US assessment of G42’s ties to the Chinese Communist Party, military and government before the Microsoft deal moved forward.
The US Commerce Department and the G42 did not immediately respond to Reuters requests for comment. Microsoft declined to comment on the report.
The approved export license requires Microsoft to prevent access to its UAE facility to personnel from countries subject to a US arms embargo or who are on the List of Subjects of the US Office of Industry and Security, according to the Axios report.
The restrictions include people physically located in China, the Chinese government or personnel working for any organization based in China, the report added.
US officials have said artificial intelligence systems could pose national security risks, including facilitating the development of chemical, biological and nuclear weapons. In October, the Biden administration required the makers of the largest AI systems to share details about them with the US government.
The G42 said earlier this year that it was actively working with US partners and the UAE government to align standards for the development and implementation of artificial intelligence, amid concerns over its ties to China.
Abu Dhabi’s sovereign wealth fund Mubadala Investment Company, the ruling family of the United Arab Emirates and US private equity firm Silver Lake have stakes in G42. The company’s chairman, Sheikh Tahnoon bin Zayed Al Nahyan, is the UAE national security adviser and brother of the UAE president.
