The US government has cleared Nvidia to sell advanced artificial intelligence chips to China. The Department of Commerce announced the decision on Tuesday. Officials said they reviewed domestic chip supply before acting. The move softens earlier export controls on sensitive technology.
Washington restricted the sales over national security concerns. Officials warned the chips could strengthen China’s technology sector and military. The new decision relaxes those limits under tight conditions. Authorities framed the change as cautious and controlled.
Nvidia’s H200 chips regain access to Chinese buyers
The decision covers Nvidia’s H200 processors. The chip ranks as Nvidia’s second-most-advanced AI product. Regulators previously blocked the processor from Chinese customers. The new rules allow shipments to resume.
The Commerce Department tied exports to sufficient US supply. Officials want to protect American access to the chips. Regulators said they will monitor inventories closely. The policy also includes less advanced Nvidia processors.
Security conditions shape the new policy
The Bureau of Industry and Security set strict requirements for Chinese buyers. Customers must show strong security safeguards. Authorities ban any military use of the chips. Officials promised active enforcement.
Regulators warned that violations would trigger penalties. The agency said the rules reduce national security risks. Officials described the policy as a balance between trade and protection.
Trump endorses sales with a government cut
President Donald Trump said last month he would allow sales to approved Chinese customers. He said the US government would collect a 25 percent fee. Trump presented the plan as a defense of American interests. He described the approach as limited access.
Nvidia welcomed the decision through a company spokesperson. The firm said the move would support US jobs and manufacturing. Executives argued that exports strengthen American competitiveness.
Beijing pushes back against US restrictions
A Chinese embassy spokesperson said Beijing opposes politicised technology trade. He said restrictions disrupt industrial and supply chains. The spokesperson said the approach harms shared interests. Chinese officials have voiced similar criticism before.
The response highlighted ongoing tensions. Both countries view artificial intelligence as strategically vital. The issue remains central to broader trade disputes.
Nvidia navigates rivalry between Washington and Beijing
Nvidia sits at the center of the US-China technology rivalry. The company has faced shifting rules from both governments. Trump reversed earlier sales limits last July. He then demanded a share of Nvidia’s China revenue.
After that move, Beijing reportedly urged firms to avoid Nvidia chips. Authorities encouraged companies to buy domestic semiconductors. The strategy aimed to strengthen China’s chip industry. Experts say Chinese chips still lag behind US designs.
Most powerful Nvidia chips stay blocked
The H200 chip trails Nvidia’s Blackwell processor by one generation. Analysts consider Blackwell the world’s most advanced AI chip. US authorities continue to block its sale to China. Officials cite higher security risks.
The restriction marks the limits of the policy shift. Washington continues to protect its most powerful technology. The decision reflects a cautious strategy.
Lobbying efforts and market impact
During 2025, Nvidia chief executive Jensen Huang lobbied US officials. He argued that global markets support American leadership. Huang said export limits weaken competitiveness.
Some US officials disagreed. They warned the chips could benefit China’s military. Others feared damage to US AI development.
Semiconductor analyst Austin Lyons said Chinese firms will pursue H200 chips. He said demand will last until domestic alternatives improve. Lyons said Nvidia will accept lower margins on China sales. He noted that government fees will cut profits.
A possible shift in trade strategy
Marc Einstein from Counterpoint Research described Trump’s plan as unusual. He said the government taking a direct cut could set a precedent. Einstein said the model may influence future trade talks. He added that other sectors may face similar deals.
