Customs officials said on Wednesday that Malaysia seized 30 server units containing advanced AI chips worth MYR 49.5 million (USD 12.1 million) at Kuala Lumpur International Airport. The seizure marks the fifth case this year involving a suspected syndicate transporting advanced AI chips through the country.
The Southeast Asian nation is strengthening controls to prevent restricted semiconductors from being routed through its territory to other destinations. The latest seizure comes as authorities investigate suspected attempts to bypass export restrictions on advanced computing technology.
Airport customs director Aspalila Ag Tuah said officials inspected the airport's free trade zone this month and seized 30 server units containing advanced AI chips. The shipment was valued at MYR 49.5 million, or approximately USD 12.1 million.
According to Aspalila, the servers had been declared as electronic components to avoid detection by authorities.
"The servers were declared as 'electronic components' to avoid detection by the authorities," she said at a news conference.
Initial investigations indicated that the servers were intended for re-export to another country in Asia. The syndicate allegedly used Malaysia as a transit point to avoid restrictions during the shipment's onward journey.
Aspalila said the servers originated from an Asian country but declined to disclose their exact origin, where the chips were manufactured, or their intended destination.
Customs officials said the latest seizure is the fifth case this year involving the suspected syndicate. The total estimated value of the cases exceeds USD 24 million.
Malaysia, which is emerging as a major data-center hub, is seeking to prevent its airports and trade facilities from becoming transit points for restricted semiconductor shipments.
A company that facilitated the latest shipment has been called in to assist with the investigation. Aspalila said the case remains under investigation and declined to provide further details.
Authorities are examining whether the network has repeatedly attempted to move advanced AI chips through Malaysia.
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Malaysia tightened export and transshipment controls on chips from the United States last year. The rules require a strategic trade permit and advance notification when there is suspicion that the technology could be misused or diverted.
The measures come amid growing US efforts to restrict the movement of advanced semiconductors through Malaysia and Thailand to prevent their diversion to China.
Malaysia has also launched investigations into other shipments, including a case involving servers containing US-made NVIDIA chips that were destined for Singapore but ended up in Malaysia.
Authorities said they found no evidence of illicit trade in advanced semiconductors in that case. The latest seizure highlights the challenges authorities face as they try to monitor international shipments of high-performance AI hardware and prevent restricted technology from being diverted through third countries.