The U.S. State Department has directed its embassies worldwide to highlight what it describes as extensive attempts by Chinese firms, including AI startup DeepSeek to appropriate intellectual property from American artificial intelligence laboratories, according to a diplomatic cable reviewed by Reuters.

The cable stated that the initiative aims to “warn of the risks of using AI models derived from United States proprietary systems and prepare the ground for possible follow-up engagement and outreach by the U.S. government.”

Distillation involves training smaller AI systems using the outputs of larger, more costly models in a bid to reduce the expense of developing advanced tools.

DeepSeek, the Chinese startup whose low-cost AI model drew global attention last year, on Friday unveiled a preview of a much-anticipated new version tailored for Huawei chip technology, highlighting China’s increasing self-reliance in the field.

The U.S. State Department, DeepSeek, and the Chinese Embassy in Washington did not immediately respond to requests for comment.

The cable also referenced Chinese artificial intelligence companies Moonshot AI and MiniMax, neither of which immediately responded to requests for comment.

Earlier this week, the White House raised similar allegations.

The Chinese Embassy in Washington dismissed the claims as “baseless allegations,” adding that Beijing “attaches great importance to the protection of intellectual property rights.”

“A separate demarche request and message has been sent to Beijing for raising with China,” the document states.

The cable, which has not been previously reported, indicates that the Trump administration is treating growing concerns about China’s distillation of U.S. AI models with increased seriousness.