• Nvidia and Anthropic are split on artificial intelligence policy with U.S. chip export restrictions set to take effect.
• Amazon-backed Anthropic said that Chinese smuggling tactics involved chips hidden in "prosthetic baby bumps" and "packed alongside live lobsters."
• An Nvidia spokesperson called the claims "tall tales" and blasted the use of policy to limit competitiveness.

blasted Thursday in a rare public clash over policy with U.S. set to take effect.

"American firms should focus on innovation and rise to the challenge, rather than tell tall tales that large, heavy, and sensitive electronics are somehow in 'baby bumps' or 'alongside live lobsters,' " a spokesperson for Nvidia said.

, the AI startup backed by billions from , argued for tighter controls and enforcement, saying in a blog post Wednesday that tactics involved chips hidden in "prosthetic baby bumps" and "packed alongside live lobsters."

from former President Joe Biden's term, called the "AI Diffusion Rule," are set to take effect May 15. The rule puts global export controls on advanced AI chips and model weights to prevent rival nations like China from gaining ground in an escalating AI arms race.

President Donald Trump is reportedly working on updating these , adding another layer of uncertainty to the already contentious policy.

Anthropic, which relies heavily on Nvidia hardware to train its models, is calling for tighter restrictions that could limit Nvidia's overseas business and revenue from chip sales.

Anthropic argued that compute access is the key strategic chokepoint in the race to build . The company proposed lowering the export threshold for Tier 2 countries, tightening the rules to reduce smuggling risks, and increasing funding for enforcement.

"Maintaining America's compute advantage through export controls is essential for national security and economic prosperity," Anthropic wrote.

In a sharply worded response to Anthropic, an Nvidia spokesperson blasted the use of policy to limit competitiveness.

"China, with half of the world's AI researchers, has highly capable AI experts at every layer of the AI stack. America cannot manipulate regulators to capture victory in AI," the spokesperson said.

"Anthropic stands by its recently filed public submission in support of strong and balanced export controls that help secure America's lead in infrastructure development and ensure that the values of freedom and democracy shape the future of AI," a company spokesperson said in a statement.

The company cited the 2022 arrest of a woman into China and the 2023 seizure of "computer display cards" with a in Hong Kong.

Nvidia CEO , who visited with in mid-April, said Wednesday in Washington, D.C. that China is "not behind" the U.S. in AI and praised Huawei as a top global tech company.

"They're incredible in computing and network technology, all these essential capabilities to advance AI," Huang said. "They have made enormous progress in the last several years."