The US government has approved Nvidia’s sale of high-end artificial intelligence chips to China. The Department of Commerce announced the decision on Tuesday. Officials said they reviewed domestic supply levels before acting. The move relaxes previous export restrictions on sensitive technology.
Washington had blocked the sales over national security concerns. Officials warned the chips could boost China’s technology sector and military capabilities. The new policy lifts some limits under strict conditions. Authorities described the change as cautious and controlled.
H200 processors allowed for export
The approval applies to Nvidia’s H200 processors. The chip ranks as the company’s second-most-advanced AI product. Regulators had previously barred the processor from Chinese buyers. The new rules allow shipments to resume.
The Commerce Department said exports depend on sufficient US supply. Officials want to protect domestic access to the chips. Regulators said they will monitor inventories closely. The policy also includes less advanced Nvidia processors.
Security and military restrictions remain
The Bureau of Industry and Security set strict conditions for Chinese buyers. Customers must demonstrate strong security measures. Authorities prohibit any military use of the chips. Officials promised active enforcement throughout the supply chain.
Regulators warned that violations will trigger penalties. The rules aim to reduce national security risks. Officials described the policy as a balance between trade and protection.
Trump backs controlled sales with fee
President Donald Trump said last month he would allow sales to approved Chinese buyers. He said the US government would collect a 25 percent fee. Trump described the plan as a safeguard for American interests. He called it limited access rather than full permission.
Nvidia welcomed the decision through a spokesperson. The firm said the move would support US jobs and manufacturing. Executives said broader export access strengthens American competitiveness.
China criticizes US technology restrictions
A Chinese embassy spokesperson said Beijing opposes politicized technology trade. He said restrictions disrupt industrial and supply chains. The spokesperson added that the approach harms shared interests. Chinese officials have made similar statements repeatedly.
The comments highlight ongoing tensions between the two countries. Both governments view artificial intelligence as strategically critical. The issue remains central to broader trade and security disputes.
Nvidia in the middle of US-China rivalry
Nvidia sits at the center of the US-China AI race. The company has faced shifting rules from both governments. Trump reversed earlier sales restrictions last July. He then demanded a share of Nvidia’s China revenue.
After that move, Beijing reportedly told tech firms to avoid Nvidia chips. Authorities encouraged companies to use domestic semiconductors instead. The strategy aimed to strengthen China’s chip industry. Analysts say Chinese chips still lag behind US designs.
Most advanced Blackwell chips remain blocked
The H200 chip is one generation behind Nvidia’s Blackwell processor. Analysts consider Blackwell the world’s most advanced AI chip. US authorities continue to block its sale to China. Officials cited higher security risks.
The restriction highlights the limits of the policy shift. Washington continues to protect its most powerful technology. The decision reflects a cautious strategy.
Lobbying and market effects
During 2025, Nvidia CEO Jensen Huang lobbied US officials for approval. He argued that global market access strengthens US leadership. Huang said restricting exports weakens competitiveness.
Some US officials disagreed. They warned the chips could benefit China’s military. Others feared damage to US AI progress.
Semiconductor analyst Austin Lyons said Chinese firms will pursue H200 chips. He said demand will last until domestic alternatives improve. Lyons noted Nvidia will accept lower margins on China sales. He added that government fees will reduce profits.
Possible precedent for trade policy
Marc Einstein from Counterpoint Research described Trump’s plan as unusual. He said taking a direct cut from sales could set a precedent. Einstein suggested the model might influence future trade negotiations. Other sectors could face similar arrangements.
