Commerce Department elevates UAE to tier shared with Europe, India
The Commerce Department’s rule change allows the UAE’s main artificial-intelligence company, G42, to buy chips freely from firms such as Nvidia for at least the next nine months, according to the Wall Street Journal. It also lifts limits on U.S. companies including Microsoft and OpenAI that have planned data centers in the country — companies that previously needed licenses approved by the Commerce Department to export chips for running AI models, a process that can take months. Industry analysts said the greater chip access could be worth billions of dollars.
The Emirati push for chip access began in the final two years of the Biden administration, led by Sheikh Tahnoon, who is the brother of UAE President Sheikh Mohamed bin Zayed Al Nahyan. UAE officials initially lobbied the U.S. against starting a war with Iran, then shifted to an aggressive stance after the Gulf state bore the brunt of Iran’s retaliatory drone attacks, coordinating strikes with the U.S. and Israel, according to people familiar with the discussions. Emirati officials have indicated that G42, which is controlled by Sheikh Tahnoon, plans to become a U.S. company mostly owned by U.S. investors, the Journal reported.
“This time, U.A.E. officials met with a more favorable reception,” one person familiar with the lobbying said.
UAE Ambassador to the U.S. Yousef Al Otaiba said the move “advances decades of deep and dependable U.A.E.-U.S. cooperation.”
President Trump, at a recent Group of Seven summit in France, praised UAE President Sheikh Mohamed bin Zayed Al Nahyan. “His Highness is a warrior,” Trump said. “They’ve been with the United States for a long time, but I would say much more so since I came on board.”
The financial ties between Sheikh Tahnoon and Trump are drawing fresh attention in Congress. Four days before Trump’s second inauguration, Sheikh Tahnoon and other investors struck a deal to invest $500 million for a 49% stake in World Liberty Financial, a cryptocurrency company started by the Trump family. Democrats have said the investment presents a significant conflict of interest for the administration’s foreign policy. The UAE also promised to invest $1.4 trillion in the U.S.
Trump’s financial disclosures, released last month, reported $263 million from the sale of the World Liberty Financial stake, one of the largest chunks of his 2025 income.
“It smells like it could be an illegal pay-to-play scheme,” Rep. Sydney Kamlager-Dove (D., Calif.) said at a House of Representatives committee hearing Tuesday. She questioned Jeffrey Kessler, a Commerce Department official whose unit oversees export controls, about the agreement. Kessler said he did not discuss chips going to the UAE with Trump family members or World Liberty Financial executives and defended the move. “It is one of the most significant achievements of the administration,” he said.
The White House has denied conflicts of interest.
The Commerce Department cited “the U.A.E.’s commitment to preventing the diversion and misuse of sensitive U.S. technology” in a statement on the change.
The Trump administration’s earlier decision last year to allow some chips to be exported to the UAE drew criticism from China hawks who argued that shipments could hurt the U.S. in the AI race. Those claims are being resurfaced after the Commerce Department’s latest decision. Others have raised concerns about the security of advanced computing power built outside the U.S.
“The U.A.E. has been a great partner with Iran, but that doesn’t necessarily mean they’ve demonstrated the capability to keep a data center secure,” said Michael Sobolik, a senior fellow at the Hudson Institute, a conservative think tank.
The UAE signed the Abraham Accords in 2020, strengthening ties between Israel and several Arab countries, and chose to fight alongside the U.S. against Iran, according to an American official, who said that demonstrated to the White House and top administration officials that the UAE is a reliable ally.