The US Department of State has ordered a global diplomatic campaign to draw attention to what it describes as widespread efforts by Chinese companies, including the startup DeepSeek, to steal intellectual property from American artificial intelligence laboratories, according to a diplomatic cable seen by Reuters.
The document, dated Friday and addressed to diplomatic and consular posts worldwide, instructs diplomatic staff to discuss with their foreign counterparts the ‘concerns about the extraction and distillation of American AI models by adversaries.’
‘A demarche request and a separate message have been sent to Beijing to be conveyed to China,’ the document specifies.
Distillation is the process of training smaller AI models using the results of larger and more costly models, in order to reduce the development costs of a new powerful AI tool.
This week, the White House made similar accusations, but the existence of this cable had not been reported until now. The State Department did not immediately respond to a request for comment.
OpenAI warned American lawmakers that DeepSeek was targeting the creator of ChatGPT as well as the leading AI companies in the country to replicate their models and use them for its own training, Reuters reported in February.
CONTEXT: The US is escalating its concerns over Chinese companies allegedly stealing intellectual property from American AI labs. FACT CHECK: OpenAI is being cited for alerting US lawmakers about the activities of DeepSeek.
CHINA REJECTS ACCUSATIONS
The Chinese embassy in Washington reiterated its position on Friday, stating that these accusations are unfounded.
‘The allegations that Chinese entities are stealing American intellectual property in AI are groundless and deliberate attacks on China’s development and progress in the AI industry,’ it declared in a statement transmitted to Reuters.
DeepSeek, whose low-cost AI model surprised the world last year, released a preliminary version of a highly anticipated new model, called V4, on Friday, specifically tailored to Huawei chip technology, highlighting China’s growing autonomy in the sector.
DeepSeek also did not immediately respond to a request for comment. In the past, the company claimed that its V3 model used data naturally collected through web crawling and did not intentionally use synthetic data generated by OpenAI.
Multiple Western governments and some Asian countries have banned their institutions and officials from using DeepSeek, citing concerns about data privacy. However, DeepSeek models are regularly among the most used on international platforms hosting open-source models.
The State Department’s cable specifies that its goal is to ‘warn about the risks associated with the use of distilled AI models from American proprietary models, and to lay the groundwork for potential follow-up actions by the US government.’
It also mentions the Chinese AI firms Moonshot AI and MiniMax. Neither of the two companies immediately responded to a request for comment.
The document states that ‘AI models developed from clandestine and unauthorized distillation campaigns allow foreign actors to market products that appear to offer comparable performance on some benchmark tests at a fraction of the cost, without replicating the full performance of the original system.’
It adds that these campaigns ‘deliberately remove security protocols from resulting models and negate mechanisms to ensure that these AI models are ideologically neutral and oriented towards the pursuit of truth.’
The accusations from the White House and this cable come just weeks before the planned visit of US President Donald Trump to Chinese President Xi Jinping in Beijing. They could reignite tensions in a long-standing technological war between the two rival superpowers, tensions that had been eased through negotiated de-escalation in October last year.
