The United States has approved Nvidia’s request to sell its advanced artificial intelligence chips to China, according to a statement released by the Department of Commerce on Tuesday.
The decision allows Nvidia to export its H200 processors, which are among the company’s most powerful AI chips. These chips were previously restricted due to concerns that they could strengthen China’s technology sector and military capabilities.
US officials said the approval depends on one key condition. There must be enough supply of these chips available for the US market before shipments can go to China.
Trump Administration Sets Conditions for Chip Sales
President Donald Trump confirmed last month that Nvidia would be allowed to sell AI chips to selected Chinese buyers. However, the company will be required to pay a 25 percent fee to the US government on those sales.
A spokesperson for Nvidia welcomed the move and said the decision would support manufacturing growth and job creation in the United States.
The Commerce Department explained that the updated export rules apply not only to the H200 chip but also to less powerful AI processors. Chinese buyers must meet strict security standards and are banned from using the chips for any military purpose.
Most Advanced Nvidia Chip Still Blocked
Nvidia’s Blackwell processor, which is currently the company’s most advanced AI chip, remains banned from sale in China. The H200 is one generation older and is seen as a compromise between trade access and national security.
China responded critically to the announcement. Embassy spokesperson Liu Pengyu told the BBC that Beijing opposes turning technology and trade into political tools. He added that blocking China harms global supply chains and does not benefit either country.
Nvidia Caught Between Two Global Powers
Nvidia continues to face pressure from both Washington and Beijing as competition in artificial intelligence intensifies worldwide.
Last July, President Trump reversed earlier restrictions on chip sales but demanded a share of Nvidia’s China related revenue. Following that move, China reportedly urged its tech companies to reduce reliance on Nvidia and focus on locally made chips instead.
While this policy aims to strengthen China’s domestic chip industry, experts say Chinese alternatives still fall behind US technology.
Industry Experts Share Mixed Views
Throughout 2025, Nvidia CEO Jensen Huang pushed US officials to allow chip exports to China. He argued that access to global markets is vital for the long term strength of American companies.
Some US policymakers remain uneasy. They worry that even limited access to AI chips could help China’s military and slow America’s progress in artificial intelligence.
Semiconductor analyst Austin Lyons said Chinese firms will likely seek H200 chips until domestic options improve. He added that Nvidia will benefit from any revenue from China, even if profits are reduced due to the government fee.
Marc Einstein from Counterpoint Research noted that Trump’s plan to take a direct cut from chip sales is unusual and could influence future trade negotiations in other industries.
