According to a report from Seeking Alpha, OpenAI's upcoming ban on API access to its AI models in China will not apply to Microsoft Azure's customers in the country. The joint venture between Azure and its operations in China allows AI models to be available to customers in China, as stated in public statements. OpenAI's restriction on Chinese users from accessing its APIs is set to take effect on Tuesday, July 9. PYMNTS reached out to Microsoft and OpenAI for comment but has not received an immediate response. OpenAI previously announced its policy to restrict access to AI software for users in countries outside of the regions it supports, which includes China.

While ChatGPT is unavailable in mainland China, companies have been able to develop their own applications by accessing OpenAI's API platform. OpenAI spokespersons have stated that additional measures will be taken to block API traffic from unsupported regions. The Biden administration has proposed regulations on major cloud service providers, including Microsoft, to identify and investigate foreign clients involved in AI application development on their platforms. China's rapid advancement in AI and other emerging technologies has raised concerns for the Biden administration, which views Beijing as a strategic competitor. The World Intellectual Property Organization (WIPO) reported that China has filed more than six times the number of generative AI patents compared to the United States, establishing itself as a dominant force in the field.