Malaysia's trade ministry is currently investigating reports regarding a Chinese company operating within the country that is allegedly utilizing servers equipped with Nvidia and other artificial intelligence (AI) chips for the purpose of training large language models (LLMs). The ministry confirmed on Wednesday, June 18, 2025, that it is in the process of verifying these media reports. A statement from the ministry indicated that it is "still in the process of verifying the matter with relevant agencies if any domestic law or regulation has been breached."

This investigation follows a report by The Wall Street Journal, which stated that Chinese engineers traveled to Malaysia in early March, reportedly carrying suitcases filled with hard drives. These engineers were purportedly seeking to establish and build AI models in Malaysian data centers that house servers powered by Nvidia chips.

The context for this scrutiny includes past U.S. government actions regarding the export of sophisticated AI chips. The Biden administration had previously implemented curbs on such exports, categorizing Malaysia in a 'second tier' of countries subject to restrictions, including caps on the number of chips it could receive. While the Trump administration has since rescinded these specific curbs, guidance has been issued requiring U.S. companies to take measures to prevent their AI chips from being used in Chinese AI model training activities.