The success of DeepSeek is being met with concern in the form of legislation, which seeks to ban the AI chatbot on US government devices. Reuters
The success of DeepSeek is being met with concern in the form of legislation, which seeks to ban the AI chatbot on US government devices. Reuters
The success of DeepSeek is being met with concern in the form of legislation, which seeks to ban the AI chatbot on US government devices. Reuters
The success of DeepSeek is being met with concern in the form of legislation, which seeks to ban the AI chatbot on US government devices. Reuters

DeepSeek faces potential ban from US government devices


Cody Combs
  • English
  • Arabic

A new bill introduced in the US Congress could ban DeepSeek from government devices.

A bipartisan group of senators, including Nevada Democrat Jacky Rosen, Ohio Republican Jon Husted and Nebraska Senator Pete Ricketts, has introduced a bill that seeks to address security concerns about the China-based generative artificial intelligence chatbot. The legislation comes weeks after a similar bipartisan bill was introduced in the House of Representatives.

“The Chinese Communist Party has made it abundantly clear that it will exploit any tool at its disposal to undermine our national security, spew harmful disinformation and collect data on Americans,” Democratic representative Josh Gottheimer said this month.

Optimism over AI's potential has sparked a blistering rally in China's stock market over the past month. Photo: Bloomberg
Optimism over AI's potential has sparked a blistering rally in China's stock market over the past month. Photo: Bloomberg

“Now, we have deeply disturbing evidence that they are using DeepSeek to steal the sensitive data of US citizens. This is a five-alarm national security fire.”

Most recently, Australian politicians made the decision to ban DeepSeek on government computers and mobile devices over concerns from technology security experts about potential user-data vulnerability related to the Chinese government.

Texas Governor Greg Abbott has also demanded that state government workers and agencies do not download or install DeepSeek, while the state of New York announced a ban on the chatbot on government devices as well.

Some have argued that, like TikTok, which is also based in China, DeepSeek's data is subject to Beijing's rules and regulations and presents a national security concern.

TikTok has been banned from US government devices at the municipal, state and federal level. A law that sought to ban the platform across the country was upheld by the Supreme Court last month but the grace period was extended by President Donald Trump.

Some say that due to its origins in China, DeepSeek will face a similar regulatory trajectory to TikTok. EPA
Some say that due to its origins in China, DeepSeek will face a similar regulatory trajectory to TikTok. EPA

Some observers say DeepSeek is heading down the same regulatory path as TikTok, as other worries about the AI app mount.

Personal data aspects aside, there is growing concern that DeepSeek may have stolen from US technology companies, with Microsoft and OpenAI currently investigating the possibility that the China-based company obtained data illegally for use on its AI platform.

“We know that groups in the PRC are actively working to use methods, including what’s known as distillation, to try to replicate advanced US AI models,” an OpenAI representative told The National.

“We are aware of and reviewing indications that DeepSeek may have inappropriately distilled our models and will share information as we know more. We take aggressive, proactive countermeasures to protect our technology and will continue working closely with the US government to protect the most capable models being built here.”

The bills seeking to ban DeepSeek on US government devices have not yet made it out of their respective legislative committees, so it remains to be seen if they will receive a vote.

Meanwhile, DeepSeek is still near the top of many mobile app-store download charts amid claims that it equals rival chatbots such as ChatGPT while using significantly less computing power at a fraction of the cost.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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A worker is categorised as skilled by the MOHRE based on nine levels given in the International Standard Classification of Occupations (ISCO) issued by the International Labour Organisation. 

A skilled worker would be someone at a professional level (levels 1 – 5) which includes managers, professionals, technicians and associate professionals, clerical support workers, and service and sales workers.

The worker must also have an attested educational certificate higher than secondary or an equivalent certification, and earn a monthly salary of at least Dh4,000. 

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Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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Updated: February 28, 2025, 2:55 AM