# China opposes US DeepSeek ban as it drafts its own export controls > Source: > Published: 2026-10-22 14:27:36+00:00 *China just filed a formal protest over the DeepSeek ban. Beijing's own export-control wishlist, dropped days earlier, shows it has leverage to play with too.* China's Ministry of Commerce issued a formal objection on October 20, 2026, to a US Department of Homeland Security order stripping DeepSeek's AI models from federal civilian systems. The ministry called the move discriminatory and said it disregarded the understanding reached between Xi Jinping and Donald Trump, adding that China would "take all necessary measures to firmly defend its legitimate rights and interests." The timing matters: the objection landed less than a week after Beijing's own commerce and science ministries proposed a sweeping new list of 40 technologies, including advanced AI chip designs and large language models, that China wants to restrict from export. The DHS order itself is dated July 24 and was signed by Homeland Security Secretary Markwayne Mullin, but it only became public this week. DHS posted it for public inspection on October 19 and scheduled it for formal Federal Register publication on October 20. Titled Exclusion and Removal Order #2026-01, it bars Hangzhou DeepSeek Artificial Intelligence and its affiliates from federal procurement, and it goes further than a typical vendor ban: agencies also can't buy any third-party product built on top of DeepSeek's models. DHS said the models present "multiple threat vectors," warning that DeepSeek's outputs could yield "actionable intelligence on US persons and/or government agencies" and that the models themselves might carry embedded vulnerabilities. China's response wasn't quiet. The commerce ministry said the US was using "the guise of national security" to politicize trade and tech policy, and it promised to "closely monitor the situation." That's the language of a government keeping retaliation on the table rather than ruling it out. What actually changed this week isn't a fresh American chip rule. It's that China is now drafting the kind of export control regime it has spent years criticizing Washington for running. On October 16, the Ministry of Commerce and the Ministry of Science and Technology published a draft revision to China's Catalogue of Technologies Prohibited and Restricted from Export, adding roughly 40 items across artificial intelligence, solar power and biomedicine. Public comments are open through November 15. [Nvidia's banned chips are selling for twice their price in China and Washington still thinks the export controls are working](https://startupfortune.com/nvidias-banned-chips-are-selling-for-twice-their-price-in-china-and-washington-still-thinks-the-export-controls-are-working/) Nvidia's restricted AI chips are selling at 2x to 3x US prices on China's gray market, with B200 racks at 50% premiums and over $1 billion smuggled in a single quarter. Jensen Huang has called US export controls "largely backfired" as Nvidia fell from 95% to zero China market share, while Huawei credited the bans for accelerating China's domestic... - [nvidia banned chips black market price](https://startupfortune.com/nvidias-banned-chips-are-selling-for-twice-their-price-in-china-and-washington-still-thinks-the-export-controls-are-working/) - [export controls china ai accelerator market](https://startupfortune.com/nvidias-banned-chips-are-selling-for-twice-their-price-in-china-and-washington-still-thinks-the-export-controls-are-working/) The AI portion alone covers 23 entries: large language models, AI agents, computing clusters and the design technologies behind advanced chips, including 2.5D and 3D packaging methods and certain memory architectures. Solar contributes another 12 items, splitting polysilicon, wafer and cell manufacturing between prohibited and restricted categories, with perovskite technology facing an outright ban and heterojunction cells restricted. Five more entries cover biomedicine, from cell and gene therapy to pathogen-related research. A commerce ministry spokesperson called the move "necessary" on national security grounds, the same justification the US has used for years to restrict Nvidia's most advanced chips from reaching Chinese buyers. China is no longer only reacting to export controls. It is building the infrastructure to impose its own. ## Nvidia is already getting squeezed from both directions This friction isn't happening in a vacuum for chipmakers. China's Cyberspace Administration has separately told domestic tech firms, including ByteDance and Alibaba, to stop buying Nvidia's AI chips and to halt testing of the company's China-specific RTX Pro 6000D server. Nvidia CEO Jensen Huang has responded by telling analysts the company now guides its financial forecasts without assuming any China revenue at all, a striking admission for a company that once treated the Chinese market as central to its growth story. On the US side, the regulatory posture toward Chinese AI chips has moved in the opposite direction more than once this year. In January 2026, the Bureau of Industry and Security eased its review standard for Nvidia's H200 and AMD's MI325X chips bound for China, shifting from a presumption of denial to case-by-case review for parts under specific performance thresholds, alongside a 25% tariff and a 50% volume cap. That loosening now sits awkwardly next to a DHS order treating a Chinese AI model as a national security threat. Here's the thing: both governments are now running export control regimes aimed squarely at the other's AI industry, and neither is backing down to make room for deals. Beijing's public comment period runs to November 15, which gives Chinese firms and foreign suppliers a narrow window to lobby against specific line items before the rules harden. Whether that produces carve-outs or simply formalizes a restriction regime that's already been operating informally for months is the question that will actually move chip stocks and AI model access over the next month, not whatever symbolic statement either side issues next. **Also read:** [IBM beat on revenue and profit, then Krishna's own words sank the stock](https://startupfortune.com/ibm-beat-on-revenue-and-profit-then-krishnas-own-words-sank-the-stock/) • [Hackers Are Quietly Hijacking Exposed AI Servers to Run Their Attacks](https://startupfortune.com/hackers-are-quietly-hijacking-exposed-ai-servers-to-run-their-attacks/) • [Chip stocks snap their worst losing streak since 2008 on TSMC's spending](https://startupfortune.com/chip-stocks-snap-their-worst-losing-streak-since-2008-on-tsmcs-spending/) *This article is posted in [Technology News](https://startupfortune.com/category/technology/), check it out for more related stories.* ## Join the discussion [Open in the community →](https://startupfortune.com/community/) Almost there. 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