Microsoft asks hundreds of China staff to relocate as tensions rise over tech

US has been trying to limit China's access to advanced chips used in AI applications over concerns they can boost country's military

Microsoft is among the US companies with the largest presence in China, after entering the market in 1992. Bloomberg

Microsoft asked some of its staff in China to consider transferring out of the country, as tensions between Washington and Beijing rise amid a race for cutting-edge technology.

The US has been looking to limit China's access to advanced chips used in AI applications because of concerns they can be used to strengthen the country's military, raising tensions that have put pressure on US companies operating in China.

Microsoft has asked between 700 and 800 employees involved in machine learning and other work related to cloud computing to consider relocating, The Wall Street Journal reported.

"Providing internal opportunities is a regular part of managing our global business. As part of this process, we shared an optional internal transfer opportunity with a subset of employees," a Microsoft representative said, without specifying how many staff were contacted.

Microsoft remains committed to China and will continue to operate in the country and in other markets, the representative said.

It is among the US companies with the largest presence in China. Microsoft entered the market in 1992 and operates a large research and development centre in the country.

The employees, mostly Chinese engineers, were this week offered the option to transfer to the US, Ireland, Australia or New Zealand, The Wall Street Journal reported. Reuters could not immediately verify those details.

The move comes days after US President Joe Biden's administration increased tariffs on Chinese imports, including electric vehicle batteries, computer chips and medical products.

Reuters reported this month that the US Department of Commerce is considering a regulatory push to restrict the export of proprietary or closed-source AI models, whose software and the data it is trained on are kept under wraps.