Chinese artificial intelligence (AI) server company Inspur Group, which is subject to U.S. sanctions, has been found to be circumventing advanced AI semiconductor export controls by utilizing its U.S. subsidiary and data centers in Southeast Asia.
According to a report by the New York Times on September 6, an analysis of thousands of shipping records and supply contracts revealed that Chinese companies are securing computing resources for advanced AI chips by evading U.S. export regulations.
Inspur, which has been building AI servers using semiconductors from companies like NVIDIA, was added to the U.S. Department of Commerce's export control list in March 2023 due to its attempts to acquire U.S. technology for military supercomputers.
In response, Inspur exploited loopholes in the regulations through its subsidiary, iBress, which is not subject to the sanctions. The company first shipped NVIDIA AI chips to Southeast Asia, where it established data centers, allowing its domestic clients to access them remotely. This strategy took advantage of the difficulty the U.S. has in monitoring and blocking remote access to AI centers located in Southeast Asia.
Trade records analyzed by the New York Times indicate that from April 2024 to February of this year, iBress exported at least $5.6 billion worth of advanced technology equipment from the U.S. to Southeast Asia, with over $3 billion of that amount consisting of computers equipped with NVIDIA's Blackwell chips.
The exported equipment has been supplied to data centers in Southeast Asia that serve major Chinese tech companies, including Alibaba and ByteDance, which are at the forefront of AI utilization. The Chinese company Megaspeed, which has been under investigation by the U.S. for allegedly smuggling advanced chips into China, is also among iBress's suppliers.
Evidence has also emerged that AI servers are being routed through Malaysia to China via Inspur's global subsidiary network. According to trade data firm Import Genius, a startup called MagInfra, established in China last year, imported over $700 million worth of servers from Malaysian companies that trade with Inspur affiliates over a six-month period.
While it is unclear whether the servers imported by MagInfra contained NVIDIA chips, considering the unit prices, it is estimated that more than 1,500 servers are of advanced quality. Although there is no official documentation linking MagInfra to Inspur, the legal representative of the parent company has previously held positions at Inspur subsidiaries.
Notably, MagInfra's office is located near Inspur's headquarters in China, but a visit by the New York Times revealed that the office is a shell address with no employees. According to Chinese procurement records, the servers imported by MagInfra have been supplied to Chinese universities and state-owned enterprises.
William George, a research analyst at Import Genius, stated, "Given this situation, it is very difficult to view this network as operating without support from the Chinese government to evade export controls."
The New York Times pointed out that iBress shares the same servers, employees, and office space as Inspur, yet federal authorities have not placed it on the sanctions list. U.S. federal authorities are investigating the status of Inspur's subsidiaries, but no clear results have emerged yet.
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.