NVIDIA is being told to follow strict U.S. licensing rules or risk losing access to China’s AI chip market.
“The license terms are very detailed,” U.S.Commerce Secretary Howard Lutnick said at a congressional hearing on Tuesday.
“They’ve been worked out together with the State Department, and those terms Nvidia must live with,” he added.
One major sticking point is a proposed know-your-customer requirement aimed at preventing China’s military from accessing NVIDIA’s H200 chips.
Last week, Reuters reported that the company has not agreed to these terms, raising national security concerns.
The U.S. has blocked the exports of semiconductor chips to China for national security reasons.
But U.S. President Donald Trump and Chinese leader Xi Jinping had reached an agreement to delay the rule for one-year as long as the exports of H200 chips were not to the Chinese military.
China had agreed on H200 chip imports for its tech giants Alibaba and Tencent, as well as AI startup DeepSeek.
All three firms reportedly have close ties to the Chinese military.
