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   15% of Nvidia and AMD China chip sales to go to US government - new export   
   licenses subject to unprecedented sales tariff despite national security   
   problem   
      
   Date:   
   Mon, 11 Aug 2025 10:05:02 +0000   
      
   Description:   
   AMD and Nvidia will have to hand over 15% of the revenue from new China chips   
   sales to US government in 'unprecedented' sales deal.   
      
   FULL STORY   
      
   The US government has reversed a ban on the sale of Nvidia's H20 chip and    
   AMDs MI308 chip to China under the condition that 15% of the revenue is paid   
   to the US government.    
      
   The Trump administration expanded efforts to curb Chinas ability to obtain   
   powerful chips used to develop AI models by expanding Biden-era sanctions to   
   an outright ban on the sale of the processors.    
      
   Many security experts, including those working under the Trump    
   administration, have warned the government the sale of powerful processors to   
   China will help it to expand both its consumer and military AI efforts to   
   surpass the US.   
      
   What happened to national security?    
      
   The Nvidia H20 and AMD MI308  processors were developed to comply with Biden   
   administration restrictions on AI processing chips that could be sold in   
   China. Restrictions were imposed on the sale of powerful AI chips to China    
   due to national security concerns surrounding the development of AI models    
   for the Peoples Liberation Army.    
      
   Trump banned the sale of these chips to China following a trade spat in April   
   2025, and then reversed the ban in July. Now, seeing the apparent worth of    
   the sales and hoping to cash in, the Trump administration is issuing a 15%   
   revenue cut for itself.    
      
   Speaking to the BBC , Nvidia said, We follow rules the US government sets for   
   our participation in worldwide markets. While we haven't shipped H20 to China   
   for months, we hope export control rules will let America compete in China    
   and worldwide.    
      
   Whether this 15% revenue cut will be passed on to the Chinese market by    
   Nvidia and AMD remains to be seen. But the elephant in the room still    
   remains.   
      
   What happened to the national security problem?   
      
   Deborah Elms, head of trade policy at the Hinrich Foundation, said You either   
   have a national security problem or you don't. If you have a 15% payment, it   
   doesn't somehow eliminate the national security issue."    
      
   Despite sanctions and trade bans, China has still managed to import powerful   
   AI processing chips through loopholes and third-parties, and is likely using   
   the chips to train AI systems to be used for military purposes.    
      
   20 security experts wrote a letter to US Commerce Secretary Howard Lutnick   
   advising against the sales of the chips to the Chinese market, adding that   
   even though the majority of the buyers would be civilian companies, the chips   
   would still be used by Chinas military.    
      
   Chips optimized for AI inference will not simply power consumer products or   
   factory logistics; they will enable autonomous weapons systems, intelligence   
   surveillance platforms and rapid advances in battlefield decision-making, the   
   letter said.    
      
   Charlie Dai, vice president and principal analyst at global research firm   
   Forrester called the deal unprecedented, further stating that, The    
   arrangement underscores the high cost of market access amid escalating tech   
   trade tensions, creating substantial financial pressure and strategic   
   uncertainty for tech vendors.   
      
   ======================================================================   
   Link to news story:   
   https://www.techradar.com/pro/15-percent-of-nvidia-and-amd-china-chip-sales-to   
   -go-to-us-government-new-export-licenses-subject-to-unprecedented-sales-tariff   
   -despite-national-security-problem   
      
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