U.S. House China Committee to question Commerce Department over Nvidia sales issue

U.S. House China Committee to question Commerce Department over Nvidia sales issue

The U.S. House Select Committee on the Chinese Communist Party, chaired by John Moolenaar, has announced its intention to seek clarification from the Commerce Department regarding Nvidia's recent decision to resume sales of its H20 chips in China [1]. This move comes amidst a backdrop of easing trade tensions between the U.S. and China.

Nvidia, a leading technology giant, had been banned from selling its advanced AI chips to China since April. The ban was imposed due to concerns about the potential misuse of the technology by Chinese military entities. However, recent developments have led to the resumption of sales, with Nvidia's CEO, Jensen Huang, meeting with officials from both the U.S. and Chinese governments to advocate for the change [2].

The H20 chip, specifically developed for the Chinese market, was initially introduced to comply with U.S. regulations while serving the demand from Chinese cloud service providers and AI firms. The chip's powerful capabilities have been noted to play a significant role in the rise of Chinese AI companies like DeepSeek, according to a bipartisan investigation [1].

The House China Panel has expressed concern over the implications of the resumption of sales on national security and the AI race between the U.S. and China. The panel aims to understand the Commerce Department's rationale behind the decision and assess any potential risks [2].

The resumption of sales has sparked mixed reactions. While some view it as a significant policy shift that could help Nvidia regain momentum in China's AI infrastructure market, others raise concerns about the potential misuse of the technology by the Chinese military. The decision comes as Beijing has relaxed trade controls on rare earth exports and the U.S. has lifted restrictions on chip design software firms operating in China [2].

Nvidia's recent announcement has been met with enthusiasm from Chinese firms, which have scrambled to place orders for the H20 GPUs. The company must now send these orders to the U.S. government for approval. The process involves a "whitelist" of Chinese companies registering for potential purchases [3].

The U.S. Commerce Department has also approved the resumption of sales for AMD's MI308 chips to China, following similar restrictions. AMD plans to restart shipments after the Commerce Department approved the license applications for the MI308 products [3].

The House China Panel's inquiry aims to provide transparency and ensure that the decision to resume sales aligns with national security interests. As trade tensions between the U.S. and China continue to evolve, the impact of these sales on the global AI ecosystem will be closely watched.

References:
[1] https://news.bloomberglaw.com/tech-and-telecom-law/house-panel-chair-to-query-commerce-on-nvidia-chip-sale-to-china?utm_campaign=00000198-19b2-de2d-a7bb-3dbf06fe0000&utm_medium=TENW&utm_source=rss
[2] https://www.ainvest.com/news/house-china-panel-query-commerce-dept-nvidia-h20-chip-china-sales-2507/
[3] https://www.taipeitimes.com/News/biz/archives/2025/07/16/2003840342