- President Trump gives chip turnover to China to resume – with a major warning
- AMD and NVIDIA will have to hand over 15% of sales income
- No additional measures have been taken to tackle the national security threats
The US government has reversed a ban on the sale of NVIDIA’s H20 -Chip and AMDS MI308 -Chip to China on condition that 15% of revenue is paid out to the US government.
The Trump administration expanded efforts to limit China’s ability to achieve powerful chips used to develop AI models by expanding the Biden-Era sanctions to a direct ban on the sale of processors.
Many security experts, including those working under the Trump administration, have warned the government of the sale of powerful processors to China will help expand both its consumer and military AI efforts to surpass the United States.
What happened to national security?
The NVIDIA H20 and AMD MI308 processors were developed to comply with Biden Administration -Limitations on AI treatment chips that could be sold in China. Restrictions were imposed on the sale of powerful AI chips to China due to national security concerns about the development of AI models for People’s Liberation Army.
Trump banned the sale of these chips to China after a trading spat in April 2025 and then returned the ban in July. Now, when you see the apparent value of the sale and hope to pay, the Trump administration sends out a 15% revenue cut for itself.
Talking to BBCNvidia said: “We follow rules that the US government sets for our participation in worldwide markets. Although we have not sent H20 to China for months, we hope that export control rules will let America compete in China and worldwide.”
Whether this 15% revenue cut will be transferred to the Chinese market by NVIDIA and AMD is still to see. But the elephant in the room is still back. What happened to the national security problem?
Deborah Elms, head of the trade policy at the Hinrich Foundation, said “You either have a national security problem or you do not. If you have a 15% payment, it does not somehow remove the national security question.”
Despite sanctions and trade bans, China has still managed to import powerful AI treatment chips through loopholes and third parties, probably using chips to train AI systems to be used for military purposes.
20 security experts wrote a letter to US trade secretary Howard Lutnick, who advised against the sale of chips to the Chinese market, adding that although most of the buyers would be civilian companies, chips would still be used by China’s military.
“Chips optimized for AI inference will not only operate consumer products or factory logistics; they will enable autonomous weapons systems, intelligence monitoring platforms and rapid progress in the Battlefield decision,” the letter said.
Charlie Dai, Vice President and Rector Analyst of the Global Research Company Forrester called the agreement “unprecedented”, stating that “The event emphasizes the high cost of market access in the midst of escalating technological merchant voltages and creates considerable financial pressure and strategic uncertainty for technical suppliers.”
