DeepSeek Nvidia chip questions: Singapore responds

Singapore’s Ministry of Trade and Industry (MTI) said in a statement Saturday that it expects U.S. companies to comply with U.S. export controls and local laws, following questions over the chips used by China’s DeepSeek to produce its AI model.

Markets were rocked this week after DeepSeek claimed its large language model outperforms OpenAI’s but cost a fraction of the price to train. However, questions were soon raised over the provenance of the semiconductors used to build DeepSeek’s R1 reasoning model given U.S. restrictions on exporting advanced AI chips in China. 

Bloomberg on Friday reported that U.S. officials were investigating whether DeepSeek had bought advanced semiconductors from chipmaker Nvidia via third parties in Singapore.

A Nvidia spokesperson told CNBC Monday that the chips used by DeepSeek were fully export-compliant. DeepSeek was not immediately available for comment when contacted by CNBC.

“We expect US companies, like Nvidia, to comply with US export controls and our domestic legislation. Our customs and law enforcement agencies will continue to work closely with their US counterparts,” MTI said in its statement.

“We have always upheld the rule of law, and acted decisively and firmly against individuals and companies that flout the rules.”

In its third-quarter results published in November, Nvidia said that Singapore accounts for almost 22% of its revenue but added that: “most shipments associated with Singapore revenue were to locations other than Singapore and shipments to Singapore were insignificant.”

MTI cited Nvidia’s comments in its Saturday statement and said the chipmaker said there was no reason to believe that DeepSeek had obtained any export-controlled products via Singapore.

“Singapore is an international business hub. Major US and European companies have significant operations here. Nvidia has explained that many of these customers use their business entities in Singapore to purchase chips for products destined for the US and other Western countries,” MTI added.

— CNBC’s Ryan Browne contributed to this report.