TMTPOST--Two U.S. lawmakers have requested that the Biden administration review Microsoft’s investment in UAE AI company G42 under the pretext of advanced technology potentially flowing to China.

Representative Michael McCaul, chairman of the House Foreign Affairs Committee, and John Moolenaar, head of the Select Committee on China, requested a briefing in a letter dated Wednesday to White House National Security Adviser Jake Sullivan, the committees announced.

The Republicans said they want the briefing on the April-announced deal before it progresses to a second phase, which involves the transfer of export-restricted semiconductor chips and model weights—sophisticated data that enhances an AI model's capability to emulate human reasoning.

The letter highlights growing concerns about the lack of regulations surrounding the export of sensitive AI models, with fears increasing that companies like G42 might share valuable technology with U.S. adversaries, such as China.

"We remain deeply concerned by attempts to rapidly advance a partnership that entails the unprecedented transfer of highly sensitive, U.S.-origin technology, without congressional consultation or clearly defined regulations in place," the lawmakers wrote in the letter.

Back on April 15, Microsoft announced a strategic investment of $1.5 billion in G42.

Microsoft said that the investment would enhance collaboration between the two companies, bringing the latest Microsoft AI technology to the UAE and other countries, and Microsoft President Brad Smith will join the G42 board of directors.

Meanwhile, G42 will run its AI applications and services on Microsoft's Azure cloud service, providing AI solutions to global customers with partners. Additionally, both companies will work together to bring AI and digital infrastructure to countries in the Middle East, Central Asia, and Africa.

They have also signed commercial agreements and an Inter-Governmental Assurance Agreement (IGAA) to ensure the secure, trustworthy, and responsible development and deployment of AI.

Microsoft emphasized in its announcement that both companies would continue to comply with U.S. and international laws on trade, security, responsible AI, and business integrity.

However, U.S. lawmakers are concerned about the broader implications of this deal. The two lawmakers highlighted that this deal could be one of the most significant investments by a U.S. tech company in the Middle East in decades. Therefore, both the executive branch and Congress should conduct a special review to ensure the protection of strategic and national security interests, they argued. The lawmakers pointed out that their primary goal is to curb China’s influence.

The lawmakers cited a recent visit by UAE President Sheikh Mohamed bin Zayed Al Nahyan to Beijing to discuss cooperation in AI. They also raised concerns about G42 CEO Peng Xiao’s connections with China, accusing G42 and its affiliates of maintaining active links with Chinese entities evading U.S. sanctions and export controls.

The lawmakers’ letter mentioned that in the first phase of the cooperation agreement, Microsoft would limit the transfer of sensitive technologies to G42, while negotiations for the second phase, which involves exporting sensitive US-origin technologies to the UAE, are still ongoing. If the second phase proceeds, it will require stronger “national security guardrails” than the first.

Peng told Bloomberg, “We have exited all our previous investments in China. As a result, we no longer need any presence in China.” However, Peng emphasized that this decision to sever ties with Chinese firms was not easy.

Currently, Microsoft and G42 have business collaborations. In November 2023, Microsoft deployed an Arabic language large model on its new Azure MaaS (Model as a Service) product for G42.

On May 22, 2024, Microsoft and G42 announced their participation in Kenya’s national initiative, launching the Kenya Digital Investment Program, leading with an initial $1 billion investment focused on building an advanced green data center for Microsoft Azure cloud services in the new region.

In response, Microsoft spokesperson David Cuddy said, “We are working closely with the National Security Council and the Department of Commerce, and U.S. national security will continue to be a principal priority.”

A spokesperson for the National Security Council said in an email statement, “The government maintains regular dialogue with lawmakers to ensure they understand the opportunities and risks posed by digital infrastructure.”

UAE Ambassador to the U.S. Yousef Al Otaiba said, “We have made substantial progress with the U.S. to strengthen the security and control of critical technologies between both countries.”

G42, founded in 2018 in Abu Dhabi, UAE, focuses on AI research, data center construction, cloud computing, energy transformation, geospatial technology, and smart cities. Its board chairman, H.H. Sheikh Tahnoon bin Zayed Al Nahyan, is a member of the UAE royal family and the UAE’s national security advisor.

G42 has significant resources in the region. In 2020, G42 and Abu Dhabi National Oil Company (ADNOC) established a joint venture, AIQ, to promote AI-driven transformation and power digitization. G42 also formed a joint venture, Khazna Data Center, to build the largest data center infrastructure in the region. Additionally, G42 owns subsidiaries like Hayat Biotech, Core42, and M42.