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China is preparing to impose strict limits on access to Nvidia's advanced H200 chips even after President Donald Trump approved their export, signaling Beijing's determination to prioritize self-sufficiency over dependence on American semiconductor technology. According to individuals familiar with internal discussions, regulators are weighing a system that would allow only tightly controlled, case-by-case access to the H200, Nvidia's second-most powerful AI processor.
Under the proposed framework, Chinese buyers would have to apply for permission to purchase the chips and justify why local alternatives cannot meet their performance needs. No final decision has been reached.
Trump announced the export approval on Monday in a Truth Social post, saying he told Chinese President Xi Jinping that Nvidia could ship H200 units to "approved customers" under conditions meant to preserve U.S. national security. He also claimed 25% of the revenue from these sales would be paid to the United States, though details of the arrangement remain unclear.
The H200 and similar high-performance chips had been barred from China during the Biden administration due to concerns they could bolster China's military or intelligence capabilities. Nvidia has lobbied heavily for the restrictions to be eased, arguing that allowing controlled exports would maintain U.S. dominance by keeping Chinese firms dependent on American technology.
But Beijing has used the ban to accelerate its domestic semiconductor ambitions. Agencies including the National Development and Reform Commission and the Ministry of Industry and Information Technology have pushed local chipmakers to close the gap with Nvidia, expanded customs checks, and encouraged data centers to adopt Chinese processors through subsidies. Officials are also considering blocking state-owned entities from buying the H200 entirely.
Still, companies such as Alibaba, Tencent and ByteDance continue to prefer Nvidia hardware for large-scale AI training, often relocating model development abroad to access chips restricted at home.
Trump's approval faces resistance in Congress, where a bipartisan group of senators has proposed a 30-month freeze on exports of advanced chips, including the H200, to China. Washington may ultimately adopt its own approval process restricting sales only to vetted companies.
Meanwhile, Nvidia has already been cleared to ship the weaker H20 chip to China, but Beijing has limited its use, arguing its performance barely exceeds domestic alternatives.
Chinese officials offered a cautious response to Trump's announcement, reiterating that cooperation should deliver "mutual benefit." Further regulatory details are still pending.
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