{"id":89389,"date":"2025-08-11T22:38:00","date_gmt":"2025-08-11T22:38:00","guid":{"rendered":"https:\/\/sotnews.agency\/?p=89389"},"modified":"2025-08-11T22:38:00","modified_gmt":"2025-08-11T22:38:00","slug":"nvidia-and-amd-to-pay-15-of-china-chip-sales-to-us","status":"publish","type":"post","link":"https:\/\/sotnews.agency\/?p=89389","title":{"rendered":"Nvidia and AMD to pay 15% of China chip sales to US"},"content":{"rendered":"
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Chip giants Nvidia and AMD have agreed to pay the US government 15% of Chinese revenues as part of an \u201cunprecedented\u201d deal to secure export licences to China, the BBC has been told.<\/p>\n

The US had previously banned the sale of powerful chips used in areas like artificial intelligence (AI) to China under export controls usually related to national security concerns.<\/p>\n

Security experts, including some who served during President Donald Trump\u2019s first term,\u00a0recently wrote to the administration expressing \u201cdeep concern\u201d\u00a0that Nvidia\u2019s H20 chip was \u201ca potent accelerator\u201d of China\u2019s AI capabilities.<\/p>\n

Trump on Monday dismissed security concerns, saying the chip in question was \u201cold\u201d.<\/p>\n

Under the agreement, Nvidia will pay 15% of its revenues from H20 chip sales in China to the US government.<\/p>\n

AMD will also give 15% of revenue generated from sales of its MI308 chip in China to the Trump administration, which was first reported by the Financial Times.<\/p>\n

Nvidia told the BBC: \u201cWe follow rules the US government sets for our participation in worldwide markets.\u201d<\/p>\n

It added: \u201cWhile we haven\u2019t shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide.\u201d<\/p>\n

AMD did not immediately respond to a request for comment.<\/p>\n

The deal sparked surprise and concern in the US, where critics said it raised security risks and questions about the Trump administration\u2019s approach to dealing with private businesses.<\/p>\n

\u201cYou either have a national security problem or you don\u2019t,\u201d said Deborah Elms, head of trade policy at the Hinrich Foundation.<\/p>\n

\u201cIf you have a 15% payment, it doesn\u2019t somehow eliminate the national security issue,\u201d she added.<\/p>\n

On social media, some investors called the arrangement a \u201cshakedown\u201c, while others compared the requirement to a tax on exports \u2013 which has long been considered illegal in the US.<\/p>\n

\u201cRegardless of whether you think Nvidia should be able to sell H20s in China, charging a fee in exchange for relaxing national security export controls is a terrible precedent,\u201d\u00a0wrote\u00a0Peter Harrell, a fellow at the Carnegie Endowment for International Peace who formerly worked for the Biden administration.<\/p>\n

\u201cIn addition to the policy problems with just charging Nvidia and AMD a 15% share of revenues to sell advanced chips in China, the US Constitution flatly forbids export taxes,\u201d he added.<\/p>\n

Democratic congressman Jake Auchincloss\u00a0said: \u201cNow the US government is financially motivated to sell AI to China? Makes me shudder to think what\u00a0a TikTok deal might look like.\u201c<\/p>\n

The H20 chip was developed specifically for the Chinese market after US export restrictions were imposed by the Biden administration in 2023.<\/p>\n

Sales of the chip were effectively banned by Trump\u2019s government in April this year.<\/p>\n

Beijing has previously criticised the US government, accusing it of \u201cabusing export control measures, and engaging in unilateral bullying\u201d.<\/p>\n

Nvidia\u2019s chief executive Jensen Huang has spent months lobbying both sides for a resumption of sales of the chips in China.He reportedly met US President Donald Trump last week.<\/p>\n

Charlie Dai, vice president and principal analyst at global research firm Forrester, said the agreement to hand over 15% of China chip sales to the US government in exchange for export licences was \u201cunprecedented\u201d.<\/p>\n

\u201cThe arrangement underscores the high cost of market access amid escalating tech trade tensions, creating substantial financial pressure and strategic uncertainty for tech vendors,\u201d he added.<\/p>\n

In a letter last month to US Commerce Secretary Howard Lutnick, a group of 20 security specialists said that while the biggest buyers of Nvidia\u2019s H20 chips were civilian companies in China, they expect them to be used by the military.<\/p>\n

They wrote: \u201cChips 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.\u201d<\/p>\n

In a statement to the BBC, Nvidia said: \u201cAmerica cannot repeat 5G and lose telecommunication leadership. America\u2019s AI tech stack can be the world\u2019s standard if we race.\u201d<\/p>\n

Intel meeting<\/h2>\n

The Nvdia and AMD agreement comes as the boss of Intel, a rival chip maker, met with Trump at the White House on Monday after the president called for his immediate resignation due to his ties to China.<\/p>\n

Intel said the pair had \u201ca candid and constructive discussion on Intel\u2019s commitment to strengthening U.S. technology and manufacturing leadership\u201d.<\/p>\n

Trump wrote on Truth Social the meeting was \u201ca very interesting one\u201d.<\/p>\n

\u201cMr. Tan and my Cabinet members are going to spend time together, and bring suggestions to me during the next week,\u201d Trump added.<\/p>\n

Last week, Trump said on social media that Lip-Bu Tan was \u201chighly conflicted\u201d, apparently referring to his alleged investments in companies that the US said were tied to the Chinese military.<\/p>\n

Mr Tan pushed back, stating it was \u201cmisinformation\u201d.<\/p>\n<\/div>\n

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\"NvidiaChip giants Nvidia and AMD have agreed to pay the US government 15% of Chinese revenues as part of an “unprecedented” deal to secure export licences to China, the BBC has been told.<\/div>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":{"facebook_2277560469115098_106292521332774":"","twitter_aToxNzczMzI3Njk4OTg4ODUxMjAxOw==_1773327698988851200":""},"rop_publish_now_history":[],"rop_publish_now_status":"pending","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[6381,4319,1910,2482,10,9,2139],"tags":[],"class_list":["post-89389","post","type-post","status-publish","format-standard","hentry","category-amd","category-china","category-international","category-nvidia","category-politics","category-popular","category-technology"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/sotnews.agency\/index.php?rest_route=\/wp\/v2\/posts\/89389","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sotnews.agency\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sotnews.agency\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sotnews.agency\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/sotnews.agency\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=89389"}],"version-history":[{"count":0,"href":"https:\/\/sotnews.agency\/index.php?rest_route=\/wp\/v2\/posts\/89389\/revisions"}],"wp:attachment":[{"href":"https:\/\/sotnews.agency\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=89389"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sotnews.agency\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=89389"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sotnews.agency\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=89389"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}