S 1638
Protection Against Foreign Adversarial Artificial Intelligence Act of 2025
TL;DR
Senator Bill Cassidy (R-LA) introduced a bill that would restrict U.S. businesses and government agencies from using AI systems developed by companies based in foreign adversary nations like China, Russia, Iran, and North Korea. Think of it as an export-controls-style crackdown, but for AI models like DeepSeek. It sits in the Senate Commerce Committee awaiting review.
How This Might Impact Your Business
Companies using or integrating Chinese-origin AI models (DeepSeek, Qwen, and similar tools from Alibaba, Baidu, or ByteDance) would likely need to remove them from their tech stacks.
Federal contractors and any business selling software or services to the U.S. government would face the strictest restrictions, mirroring the TikTok and Huawei playbook.
Cloud providers (AWS, Azure, Google Cloud) hosting foreign adversary AI models may need to delist or geofence those offerings for U.S. customers.
Enterprise software vendors that embed third-party AI (customer service chatbots, translation tools, code assistants) would need to audit their supply chain for foreign model dependencies.
Financial services, healthcare, and defense contractors face the highest exposure given existing sensitivity around foreign tech in regulated data.
The bill is early-stage (just referred to committee), so specific penalties, thresholds, and enforcement mechanisms are not yet finalized.
No small business carve-out is mentioned, meaning startups experimenting with cheap open-source Chinese models could be swept in.
What Should You Do
Ask your CTO or head of engineering to inventory every AI model in production, including embedded and open-source components, and flag anything originating from China, Russia, Iran, or North Korea.
Review vendor contracts with AI providers to confirm the country of origin for underlying foundation models, not just the vendor's headquarters.
If you use DeepSeek, Qwen, or similar models for cost savings, start pricing out U.S. or allied alternatives (OpenAI, Anthropic, Meta Llama, Mistral) as a contingency.
Have government affairs or legal monitor the Senate Commerce Committee for markup activity and be ready to submit comments if your industry has specific concerns.
Brief your board on foreign AI exposure now, before this becomes a headline risk or triggers customer due diligence questions.
Who It Affects
Sponsors
Status Timeline
committee
Read twice and referred to the Committee on Commerce, Science, and Transportation.
May 7, 2025