Nvidia Defends AI Chip Sales After Suspension of H20 Exports to China, Faces Congressional Investigation
Nvidia has stated that it follows U.S. government export laws “to the letter” after announcing a $5.5 billion loss due to canceled H20 chip orders. This came after the U.S. government imposed new restrictions, requiring a license to export the AI chips to China. The company’s comment follows increased scrutiny from Washington, D.C., amid concerns over national security and China’s access to cutting-edge technology. Nvidia’s brief statement highlights its adherence to U.S. laws, underscoring its compliance with export controls as it continues to navigate growing regulatory challenges.
This announcement comes just one day after the House Select Committee on national security threats launched an investigation into Nvidia’s sales practices. The committee raised concerns over the sale of Nvidia’s H20 chips to China, questioning whether the chipmaker had exploited a “loophole” in the Biden administration’s export controls. The H20 chip, introduced in response to export restrictions from 2022, was previously legal for export to China until the latest regulatory changes.
Nvidia, which controls a large share of the global AI chip market, also addressed its role in supporting U.S. national security. The company pointed out that its exports contribute to reducing the U.S. trade deficit and generate substantial tax revenue. The chipmaker further emphasized its impact on the U.S. economy, citing its job creation and leadership in technological innovation. Despite the scrutiny, Nvidia maintained its position that it complies with government regulations and supports U.S. interests in the global tech market.
Along with the investigation, Nvidia faces additional challenges, including new export restrictions under the “AI diffusion rules” set to take effect next month. The company also clarified concerns regarding its sales in Singapore, noting that while the country represents its second-largest market, products sold through Singapore are not intended for China. As the company navigates these hurdles, it remains focused on complying with U.S. regulations while defending its global business operations.
Source: CNBC