The Commerce Department announced a significant easing of export controls on the United Arab Emirates on Friday, sparking immediate controversy. A new 17-page rule, set for official publication on July 14, states that the Bureau of Industry and Security will “favorably review” export license applications for semiconductor and server technologies destined for MGX, a state-backed UAE investment firm.
President Donald Trump meets with United Arab Emirates President Sheikh Mohamed bin Zayed Al Nahyan during a visit to Qasr al Watan on May 15, 2025, in Abu Dhabi, United Arab Emirates.
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This decision immediately drew fire from Sen. Elizabeth Warren, a Massachusetts Democrat, who labeled the provision “corrupt.” Warren's criticism centers on MGX’s use of USD1, a stablecoin issued by the Trump family-affiliated World Liberty Financial, for its recent $2 billion investment in Binance, the world's largest cryptocurrency exchange. This transaction was a major boost for the newly launched USD1 and raised questions about potential conflicts of interest influencing U.S. policy toward the UAE.
MGX is also a key investor in leading AI companies like OpenAI and Anthropic. The broader Commerce Department rule grants the UAE government, Abu Dhabi's AI conglomerate G42, and its cloud subsidiary Core42 streamlined access to license exceptions for specific advanced-computing equipment. Additionally, the rule extends similar benefits to major tech players such as Amazon, Apple, Google, Meta, Microsoft, Oracle, OpenAI, and xAI for their UAE operations and data center projects.
The Commerce Department defended the move, stating it “will significantly upgrade the status of the United Arab Emirates” under export regulations. This upgrade, they explained, recognizes the UAE's role as a U.S. Major Defense Partner and its support in advancing U.S. national security interests, including Operation Epic Fury, the ongoing conflict against Iran.
However, Senator Warren highlighted President Trump’s recent financial disclosures, noting a reported $263 million windfall related to his crypto ventures last year, partially stemming from a 49% stake in World Liberty Financial acquired by a UAE royal behind G42 and MGX. Warren expressed concerns about the diversion of sensitive technology to China and other national security risks, arguing that the Commerce Department is granting G42 “license-free access to advanced AI chips and promising favorable treatment for MGX” despite these potential dangers.
As the ranking Democrat on the Senate Banking Committee, Warren called for Commerce Secretary Howard Lutnick and BIS Under Secretary Jeffrey Kessler to testify before Congress. She demanded explanations for what she termed a “corrupt deal” and its implications for national security. Warren, alongside other Senate Democrats, had earlier requested hearings into whether UAE-linked investments in World Liberty influenced administration decisions regarding advanced chips, arms sales, and other policies benefiting the country. Kessler is already slated to testify next week before the House Committee on Foreign Affairs. While the rule itself does not explicitly mention the UAE's financial dealings with World Liberty as an influencing factor, the timing and connections have intensified scrutiny.
