According to the regulations, the chips will be reviewed by a third-party testing lab to confirm their technical AI capabilities before they can be shipped to China, which cannot receive more than 50% of the total amount of chips sold to American customers. Nvidia will need to certify there are enough H200s in the U.S., while Chinese customers must demonstrate “sufficient security procedures” and cannot use the chips for military purposes. Those conditions had not been established previously.
Nvidia and the Chinese embassy in Washington did not immediately respond to requests for comment. U.S. President Donald Trump announced last month that he would allow the chip sales in exchange for a 25 per cent fee for the U.S. government. The decision drew fire from China hawks across the U.S. political spectrum over concerns the chips would supercharge Beijing’s military and erode the U.S. advantage in artificial intelligence.
Chinese technology companies have placed orders for more than 2 million H200 chips that are priced at around $27,000 each, Reuters reported last month, exceeding Nvidia’s inventory of 700,000 of the chips. At the Consumer Electronics Show last week in Las Vegas, Nvidia CEO Jensen Huang said the company was ramping up production of H200 chips amid strong demand both from China and the rest of the world that was driving up the price to rent the H200 chips currently sitting in cloud computing data centers.
Safety concerns had prompted the Biden administration to bar sales of advanced AI chips to China. But the Trump administration, led by White House AI czar David Sacks, argues that shipping advanced AI chips to China discourages Chinese competitors – such as heavily sanctioned Huawei – from redoubling efforts to catch up with Nvidia’s and AMD’s most advanced chip designs.
When Trump announced the sales last month, he said they would be exported to China “under conditions that allow for continued strong National Security.” But questions have arisen around whether the administration would in practice impose any limits on the chip shipments, or even if Beijing would allow their sales domestically.
