The U.S. Department of Commerce appears ready to permit Nvidia to export its advanced H200 AI chips to China, marking a significant shift in U.S. technology export policy. According to reporting by Semafor, the administration will allow shipment of H200 chips that are approximately 18 months old—substantially more powerful than the H20 models Nvidia specifically designed for Chinese regulatory compliance.
Nvidia has already expressed support for this potential policy change. A company spokesperson stated to TechCrunch: “We applaud President Trump’s decision to allow America’s chip industry to compete to support high paying jobs and manufacturing in America. Offering H200 to approved commercial customers, vetted by the Department of Commerce, strikes a thoughtful balance that is great for America.”
Decision Rests with Trump Administration
This development emerges just days after U.S. Commerce Secretary Howard Lutnick publicly acknowledged that the final decision regarding H200 exports to China ultimately rests with President Trump. The administration appears to be prioritizing economic competition over the national security concerns that have dominated previous policy positions.
The potential policy reversal represents a stark departure from the export restrictions implemented during both the Biden and early Trump administrations. In April, the Trump administration initially imposed licensing requirements on companies like Nvidia for Chinese chip exports, only to rescind a Biden-era diffusion rule in May that would have regulated AI chip exports.
Congressional Opposition Grows
This executive branch position directly contradicts bipartisan legislative efforts to restrict advanced AI technology transfers to China. On December 4, Senators Pete Ricketts (R-Nebraska) and Chris Coons (D-Delaware) introduced the Secure and Feasible Exports (SAFE) Chips Act, which would mandate a 30-month prohibition on advanced AI chip exports to China through the Department of Commerce.
The timing of a potential vote on this legislation remains uncertain, creating a possible race between executive action and legislative restrictions. The bipartisan nature of the proposed bill highlights the rare cross-party consensus on limiting China’s access to cutting-edge AI technology.
Evolving U.S. Trade Strategy
The Trump administration’s position on chip exports has fluctuated considerably throughout 2024. By summer, the government signaled openness to permitting chip exports to China with the condition that the U.S. would receive 15% of all related revenue—effectively using semiconductor technology as a bargaining chip in broader trade negotiations.
However, this policy wavering has already damaged U.S. chip manufacturers’ position in the Chinese market. In September, China’s internet regulator, the Cyberspace Administration of China, prohibited domestic companies from purchasing Nvidia chips altogether. This forced Chinese firms to rely on less advanced domestic alternatives from companies like Alibaba and Huawei.
Market and Security Implications
The decision to allow H200 chips into China creates complex implications for both the global semiconductor industry and national security interests. For Nvidia, regaining access to the massive Chinese market represents a significant commercial opportunity, potentially worth billions in revenue.
From a security perspective, critics argue that providing China with advanced AI chips could accelerate their technological development in sensitive areas including military applications, surveillance systems, and autonomous weapons. Proponents counter that the 18-month technology lag and Commerce Department vetting process provide adequate safeguards.
The semiconductor industry finds itself caught between competing national priorities: maintaining U.S. technological leadership and commercial competitiveness while simultaneously preventing strategic rivals from accessing capabilities with dual civilian-military applications.
Global Technology Competition
This potential policy shift occurs against the backdrop of intensifying technological competition between the U.S. and China. Chinese companies have invested heavily in developing domestic chip alternatives, though they currently lag behind U.S. designs in performance and efficiency.
Allowing older-generation H200 chips into China may represent a calculated compromise—providing China with technology that is advanced but not cutting-edge, while preserving American companies’ revenue streams and manufacturing capabilities.
The final decision will likely balance immediate economic interests against longer-term strategic considerations in what has become one of the most consequential technological rivalries in modern history.