The Trump administration has opened an inter-agency licensing review that could allow the first shipments of Nvidia's H200 AI chips to China, five sources told Reuters. Commerce has sent license requests to State, Energy and Defense, which have 30 days to respond before the final decision could fall to the President. The proposed sales — paired with a 25% U.S. fee — aim to keep U.S. firms competitive but have drawn criticism over potential military and AI-security risks.
U.S. Opens Inter-Agency Review That Could Allow Nvidia H200 AI Chip Shipments To China
FILE PHOTO: A NVIDIA logo appears in this illustration taken August 25, 2025. REUTERS/Dado Ruvic/Illustration/File Photo
WASHINGTON, Dec 18 (Reuters) - The Trump administration has launched an inter-agency review that could permit the first shipments to China of Nvidia's H200 artificial intelligence processors, five sources told Reuters, fulfilling President Donald Trump's pledge to allow the contentious sales.
Earlier this month, Trump said he would permit exports of Nvidia's H200 chips to China while imposing a 25% U.S. fee, arguing the move would help U.S. firms stay ahead by reducing demand for domestically produced Chinese chips. The announcement provoked criticism from lawmakers and national security experts who warned the chips could accelerate Beijing's military capabilities and erode the U.S. edge in AI.
Licensing Review Underway
The U.S. Commerce Department, which oversees export controls, has forwarded license applications for the proposed shipments to the State, Energy and Defense Departments for inter-agency review, the sources said. Under export regulations, those agencies have 30 days to provide input; if they disagree, the final decision rests with the President. The start of this formal licensing review has not previously been disclosed.
Nvidia recently told Reuters it was considering raising production of the H200 — the immediate predecessor to its flagship Blackwell family — after initial orders from China surpassed current capacity. Although the H200 performs slower than Nvidia's newer Blackwell chips on many AI workloads, it remains widely used across industry and had not previously been authorized for sale to China.
Political Stakes And Rationale
Led by White House AI czar David Sacks, several officials in the Trump administration argue that allowing limited exports of advanced AI chips could deter Chinese competitors such as Huawei from doubling down on efforts to match the most advanced U.S. and allied designs. Supporters say the 25% fee and licensing framework would maintain leverage while keeping U.S. firms commercially competitive.
Critics — including prominent China hawks across the U.S. political spectrum — contend the chips could strengthen Beijing's military capabilities and narrow America’s strategic advantage in artificial intelligence. The move represents a notable shift from Trump’s first term, when his administration tightened controls on Chinese access to U.S. technology amid concerns Beijing repurposes commercially obtained technology for military use.
The Commerce Department and Nvidia did not immediately respond to requests for comment. A White House spokesperson declined to comment on the licensing review but said, "The Trump administration is committed to ensuring the dominance of the American tech stack – without compromising on national security."
Reporting by Alexandra Alper; Additional reporting by Stephen Nellis and Karen Friefeld; Editing by Peter Henderson and Jamie Freed.
