US Clears Restricted Nvidia AI Chip Sales To China In Policy Shift

The United States has opened the door for Nvidia to sell advanced artificial intelligence chips to China under strict conditions, signalling a significant shift in Washington’s export control policy on cutting-edge technology.

The U.S. Commerce Department said on Tuesday that it would allow applications for the export of Nvidia’s H200 AI chip to be reviewed on a case-by-case basis, moving away from the earlier “presumption of denial” approach. While the decision permits limited sales, Nvidia’s most advanced processors will continue to remain off-limits to Chinese buyers.

The move follows a policy change announced last month by U.S. President Donald Trump, who said he had reached an agreement with Chinese President Xi Jinping to allow the export of H200 chips, with the U.S. government receiving a 25% share of the sales. The agreement marks a notable reversal from restrictions imposed under the previous administration, which had cited national security concerns over potential military use of advanced AI technology in China.

Despite the regulatory opening, demand from Chinese firms remains uncertain. According to reports, Chinese authorities have advised some technology companies that purchases of H200 chips would only be approved under special circumstances, such as for university research or development laboratories. Officials have also reportedly encouraged companies to adopt domestically produced AI chips, part of Beijing’s broader push for technological self-reliance.

The Commerce Department’s Bureau of Industry and Security said the revised policy applies to the H200 and similar chips, but stressed that approvals would depend on conditions such as evidence of sufficient U.S. supply and assurances regarding end use.

The policy shift has drawn sharp criticism from Democrats in the U.S. Congress, who have warned that easing restrictions could strengthen China’s military and technological capabilities. Supporters, however, argue that allowing limited sales helps ensure that global AI systems continue to be built on U.S. technology standards.

Nvidia chief executive Jensen Huang has been a vocal advocate for restoring some level of access to the Chinese market, saying that excluding China entirely risks accelerating the development of rival technologies beyond U.S. influence.

The H200 chip, a powerful graphics processing unit used to train large AI models, is approximately 18 months behind Nvidia’s most advanced offerings. While China and the United States continue to compete for leadership in artificial intelligence, the latest decision underscores Washington’s attempt to balance national security concerns with economic and technological interests.