China has forcefully refuted allegations by the United States that its leading artificial intelligence companies have engaged in "industrial-scale" theft of American AI models. The response came after three U.S. federal agencies – the FBI, NSA, and CISA – issued a joint advisory accusing Chinese AI firms of exploiting U.S. models to enhance their own systems.

The advisory, released on Tuesday, specifically named Chinese companies such as DeepSeek, Alibaba, and Moonshot AI. It claimed these companies had distilled "billions of tokens" from U.S. models since at least late 2024, suggesting this activity was likely known to the Chinese government. Tokens are the fundamental units of text processed or generated by AI models.

In a statement to the Associated Press on Wednesday, China's Commerce Ministry dismissed the U.S. claims as unfounded and characterized them as an attempt by the U.S. to secure a "monopoly of the AI industry." The ministry warned that China would "take resolute countermeasures" if the U.S. continued to suppress Chinese AI companies under the guise of targeting distillation.

Distillation, a process where smaller AI models are trained using more advanced ones, is described by the ministry as a common practice within the AI industry, including among U.S. companies. However, the U.S. advisory asserted that the "sheer scale and sophistication" of these alleged Chinese campaigns indicate that distillation is not merely supplementary but the "critical core" of their AI model development.

The Ministry of Foreign Affairs echoed the Commerce Ministry's sentiment, urging the U.S. to "refrain from making unfounded accusations or smears" against China. A ministry spokesperson stated that China's AI advancements are a result of "high-level technological self-reliance and strength" and called for enhanced cooperation to promote AI development that is "open, inclusive, universally beneficial and oriented toward the common good."

The U.S. allegations surface weeks before Chinese President Xi Jinping is scheduled to visit the United States for a summit hosted by President Donald Trump. Discussions are expected to cover a range of topics, including artificial intelligence. Reports suggest Xi might be accompanied by a significant delegation of Chinese executives during this visit.

The joint advisory by the FBI, NSA, and CISA highlights the escalating competition and tensions between the U.S. and China in the critical field of artificial intelligence. Both nations are vying for dominance in AI research, development, and application, which is seen as a key driver of future economic and geopolitical power.

This incident underscores the complex geopolitical landscape surrounding AI technology. While the U.S. agencies have raised concerns about intellectual property theft and national security implications, China maintains its progress is homegrown and accuses the U.S. of protectionist measures aimed at stifling global competition.