By Karen Freifeld

Jan 7 (Reuters) - A technology industry group on Tuesday urged President Joe Biden's administration to refrain from issuing a last-minute rule that would control global access to AI chips, warning the restrictions would jeopardize U.S. leadership in artificial intelligence.

The Information Technology Industry Council, representing companies like Amazon AMZN.O, Microsoft MSFT.O and Meta META.O, said the rule, which could come out as soon as Friday, would place arbitrary constraints on U.S. companies' ability to sell computing systems overseas and cede the global market to competitors.

Reuters reported exclusive details last month on the Commerce Department's plan for approving global AI chip exports while also preventing bad actors from accessing them. A key aim of the restrictions is to keep AI from supercharging China's military capabilities.

In a letter to U.S. Commerce Secretary Gina Raimondo, ITI CEO Jason Oxman criticized the administration's "insistence" on publishing the rule in the final days of Joe Biden's presidency. Donald Trump will be inaugurated Jan. 20.

"Rushing a consequential and complex rule to completion could have significant adverse consequences," Oxman said in the Jan. 7 letter, a copy of which was obtained by Reuters.

While ITI appreciates the commitment to national security, the letter said, "the potential risks to U.S. global leadership in AI are real and should be taken seriously."

The group asked that any such controls be issued as proposed rulemaking, rather than a rule, given the significant geopolitical and economic implications.

Neither the Commerce Department nor the White House immediately responded to requests for comment.

Industry opposition to the expected rule has become increasingly blunt and public.

The Semiconductor Industry Association issued a statement on Monday night. And on Sunday, Ken Glueck, executive vice president at Oracle ORCL.N, said in a blog post that rather than target activities of concern, the rule "drops the Mother of All Regulations on the commercial cloud industry, regulating... nearly all commercial cloud computing globally for the first time in history."

He said the "Export Control Framework for Artificial Intelligence Diffusion," as the draft rule is titled, "will go down as one of the most destructive to ever hit the U.S. technology industry."

(Reporting by Karen Freifeld; Editing by David Gregorio)

((karen.freifeld@thomsonreuters.com; +1(646) 223-6921;))