The US government has approved Nvidia’s sale of advanced artificial intelligence chips to China. The Department of Commerce announced the decision on Tuesday. Officials said the move follows a review of US chip supply. The approval eases earlier export limits on sensitive technology.
Washington had restricted the sales over security concerns. Officials warned the chips could strengthen China’s technology sector and military. The new decision relaxes those limits under strict conditions. Authorities described the shift as carefully controlled.
H200 processors cleared under strict rules
The approval applies to Nvidia’s H200 processors. The chip ranks as Nvidia’s second-most-advanced AI product. Regulators had previously blocked the processor from Chinese customers. The new policy allows shipments to resume.
The Commerce Department said exports depend on sufficient supply in the US. Officials want to protect domestic access to the chips. Regulators said they will monitor supply levels closely. The policy also covers less advanced Nvidia processors.
Security and military bans remain firm
The Bureau of Industry and Security set clear conditions for Chinese buyers. Customers must demonstrate strong security safeguards. Authorities strictly ban any military use of the chips. Officials said enforcement will remain active.
Regulators stressed that violations would trigger penalties. The agency said the rules aim to reduce national security risks. Officials framed the approach as a balance between trade and protection.
Trump backs sales with government fee
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 safeguard for American interests. He described the policy as selective access.
Nvidia welcomed the decision through a company spokesperson. The firm said the move would support US jobs and manufacturing. Executives argued that export access strengthens American competitiveness.
China criticises US technology controls
A Chinese embassy spokesperson said Beijing opposes politicised technology trade. He said restrictions disrupt industrial and supply chains. The spokesperson argued that the approach harms both sides. Chinese officials have repeated that message.
The response underlined persistent tensions. Both countries view artificial intelligence as strategically vital. The issue remains central to wider trade disputes.
Nvidia caught in global AI rivalry
Nvidia stands at the center of the US-China technology rivalry. The company has navigated shifting policies 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 policy aimed to strengthen China’s chip industry. Experts say Chinese chips still lag behind US technology.
Top-tier chips stay off limits
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 heightened security concerns.
The restriction shows the boundaries of the policy shift. Washington continues to guard its most powerful designs. The decision reflects a cautious strategy.
Lobbying and market consequences
During 2025, Nvidia chief executive Jensen Huang lobbied US officials. He argued that global markets support American leadership. Huang said restricted exports weaken competitiveness.
Some US officials disagreed. They warned the chips could benefit China’s military. Others feared harm to US AI progress.
Semiconductor analyst Austin Lyons said Chinese firms will seek H200 chips. He said demand will last until domestic options improve. Lyons said Nvidia will accept lower margins from China sales. He noted that government fees will reduce profits.
Trade policy precedent concerns
Marc Einstein from Counterpoint Research described Trump’s plan as unusual. He said taking a direct cut from sales could set a precedent. Einstein said the model may appear in future trade talks. He added that other sectors may face similar arrangements.
