Reports released by the Department of Commerce on Tuesday (13 January 2026) indicate that the U.S. government has approved chipmaker NVIDIA to sell its advanced AI-powered processors in China.
Washington had previously restricted the sale of H200, NVIDIA’s second-most advanced semiconductor, due to concerns that the chip could give China’s technology an advantage over the US military and tech industry.
Shipment of Chip Comes With Conditions
However, the export of NVIDIA’s H200 to China is subject to some conditions. According to the regulations put forward by the US government, before the chips are shipped to China, they will be reviewed by a third-party testing lab. This is to confirm their technical AI capabilities. Also, China cannot receive more than 50% of the total amount of semiconductors sold in the American market.
NVIDIA will have to certify that there is a sufficient supply of the H200 processors in the US to grant the shipment. President Donald Trump has earlier mentioned that he would allow the sales to certain approved customers in China, with a 25% fee.
The selected Chinese customers must also demonstrate sufficient security procedures and are forbidden from using the chip for military purposes. NVIDIA and the Chinese embassy in Washington have not responded to these requests.
At the same time, the Department of Commerce noticed that NVIDIA’s most advanced semiconductor, the Blackwell processor, will remain off-limits to the Chinese market. The Bureau of Industry and Security (BIS), which oversees the entire export process, has made amends to its licensing review process for H200 chips. They replaced the automatic rejection with a case-by-case review.
China’s Take on the Chip
Beijing has urged its companies to adopt the domestically produced chips, as a reaction to the absurd restrictions imposed by the US government regarding the H200. According to The Information, the Chinese government has asked the selected companies that the chips would be granted only for specific requirements, such as university research and development laboratories.
Chinese companies have placed an order of more than 2 million chips, priced around $27,000 each. Liu Pengyu, spokesman of the Chinese embassy, said in an interview given to the BBC News that the Chinese government has always opposed the weaponization of technology and trade, adding a political shade to the issues.
NVIDIA Caught Between the Political War of the US and China
NVIDIA has currently been caught in the middle of the geopolitical conflict between China and the US. The US government has also demanded that NVIDIA pay a share of its earnings from selling the chip in China.
NVIDIA’s chief executive, Jensen Huang, has previously shown his support for selling their semiconductors in China, stating that AI systems worldwide would then be built on US technology.
H200 chips are GPUs (graphics processing units) that are essential for training the AI models. These models support the rise of generative AI, which started in 2022 with the launch of ChatGPT.
While the US has given a green signal for the sale of the H200 chips in China under certain conditions, these chips remain 18 months behind NVIDIA’s most advanced Blackwell Processor, which will continue to be out of reach for China. Whether the Chinese government will approve all the conditions put forward by the US is still under discussion.
