U.S. State Department: "DeepSeek Supports Chinese Military and Intelligence Agencies"

"Using Southeast Asian firms to obtain advanced AI semiconductors"

"Accessing Southeast Asian data centers to remotely use chips"

The U.S. government believes that the Chinese artificial intelligence (AI) company DeepSeek is supporting the operations of China's military and intelligence agencies.

According to Reuters on the 23rd (local time), a senior State Department official stated that DeepSeek supports China's military and intelligence operations and uses Southeast Asian shell companies to obtain advanced semiconductors banned for export to China.

In an interview with Reuters, the official claimed, "DeepSeek willingly supported Chinese military and intelligence operations, and is likely to continue doing so in the future." He added, "Such efforts go beyond merely providing open-source access to DeepSeek’s AI models." The official raised suspicions that DeepSeek is sharing user information and statistics with surveillance agencies in Beijing.

In January, DeepSeek shocked the tech community by claiming that its AI inference model is on par with or superior to leading U.S. industry models while being significantly less expensive.

Chinese law requires companies operating in China to provide data upon government request. However, the claim that DeepSeek is providing data could raise significant privacy concerns for the tens of millions of global users each day. The U.S. continues to regulate companies believed to be linked to China’s military-industrial complex.

U.S. lawmakers have alleged that, based on DeepSeek’s public data-disclosure statement, the company is transmitting American user data to China through "backend infrastructure" associated with the Chinese state-owned telecom giant China Mobile.

The official added that DeepSeek was mentioned more than 150 times in procurement records of Chinese People's Liberation Army (PLA) and defense industry organizations, and that DeepSeek provided technological services to PLA research institutions.

The official further stated that DeepSeek is bypassing U.S. export controls to access advanced American-made chips such as NVIDIA's H100. Since 2022, these chips have been prohibited from export to China by the U.S.

The official said, "DeepSeek attempted to circumvent export controls through Southeast Asian shell companies and is accessing Southeast Asian data centers to remotely use U.S. chips."

When asked if the U.S. would impose additional export controls or sanctions on DeepSeek, the official replied, "There is nothing to announce at this time."

An NVIDIA spokesperson said, "Because of the current export controls, we have effectively withdrawn from the Chinese data center market, which is now dominated exclusively by competitors such as Huawei."

Reuters previously reported that U.S. authorities are investigating whether DeepSeek has illegally accessed restricted AI chips.

Sources familiar with the matter said DeepSeek holds a large number of H100 chips, which are banned from export to China. In a January interview with CNBC, the CEO of an AI startup claimed that DeepSeek possesses 50,000 H100 chips.

However, an NVIDIA spokesperson told Reuters that DeepSeek is actually using the legally exported H800 product, not the H100.

There is also suspicion that China has found ways to remotely use advanced U.S. chips.

Importing advanced NVIDIA chips into China without a license violates U.S. export regulations. However, Chinese companies can remotely access the same chips via certain countries’ data centers. Still, restrictions apply if the Chinese firm is on the U.S. trade blacklist or if the chip exporter knows they are used for developing weapons of mass destruction.

U.S. officials have not yet placed DeepSeek on any U.S. trade blacklist, nor have they claimed that NVIDIA knew about DeepSeek’s cooperation with the Chinese military.

Byline: Jung-A Kim, Contributor kja@hankyung.com