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<\/p>\n Email Link<\/p>\n Hong Kong \n Nvidia and AMD have agreed to pay the US government 15% of their revenues from semiconductor sales to China in exchange for export licenses, the Financial Times reported<\/a> Sunday.\n <\/p>\n \n The unprecedented quid pro quo arrangement is part of a deal with the Trump administration to obtain export licenses to sell Nvidia\u2019s H20 chips and AMD\u2019s MI308 chips in China, the FT reported, citing people familiar with the situation, including a US official. The New York Times and Reuters also later reported the 15% commission deal, citing sources. Nvidia CEO Jensen Huang met with President Donald Trump on Wednesday.\n <\/p>\n \n \u201cWe follow rules the US government sets for our participation in worldwide markets,\u201d a Nvidia spokesperson said in a statement. \u201cWhile we haven\u2019t shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide.\u201d\n <\/p>\n \n The AI chips are in extremely high demand and the arrangement could raise billions of dollars for the US government. But it\u2019s unclear how successful the venture will be, because China may not be willing to play ball: Nvidia\u2019s H20 chips pose security concerns for China, a social media account linked to Chinese state media said Sunday, as Washington and Beijing near a deadline to strike a deal in trade negotiations in which technology has also emerged as a key issue.\n <\/p>\n \n China could choose not to buy US tech firm Nvidia\u2019s H20 chips, said the account<\/a>, Yuyuan Tantian, which is affiliated with state broadcaster CCTV, as it claimed that the artificial intelligence (AI) chips could have \u201cbackdoors\u201d that impact their function and security.\n <\/p>\n \n \u201cWhen a type of chip is neither environmentally friendly, nor advanced, nor safe, as consumers, we certainly have the option not to buy it,\u201d said the commentary, which came after China\u2019s cybersecurity administration also raised concerns over backdoor access in those chips.\n <\/p>\n \n Nvidia has repeatedly denied that its products have backdoors.\n <\/p>\n \n China\u2019s access to American technology, especially high-end chips that can be used in the development of artificial intelligence, has become a key issue in trade and tech frictions between the rival economies \u2013 as both vie for tech dominance.\n <\/p>\n \n A trade truce between the two countries that reduced triple-digit tariffs is set to expire on August 12, though officials have signaled an extension could come into effect following talks in Sweden<\/a> last month.\n <\/p>\n \n Nvidia last month said it would resume sales<\/a> of the H20 chip to China after the White House changed course on export controls it imposed in April as its trade frictions with China deepened. US Treasury Secretary Scott Bessent told Bloomberg in an interview at the time that the Nvidia export controls have been a \u201cnegotiating chip\u201d in the larger US-China trade talks.\n <\/p>\n \n Nvidia released the H20 chip last year to maintain access to the Chinese market following strict export controls put in place under the Biden administration that stopped the export of chips with greater processing power.\n <\/p>\n \n Nvidia\u2019s announcement last month that it would be able to export the H20 chip to China raised concerns among some US lawmakers, who support tight controls to prevent China from using American technology to advance its military and AI systems.\n <\/p>\n \n Trump administration have correctly said that the H20 chips aren\u2019t the top-of-the-line AI chips that can build large language models. As a result, the White House has been willing to open up the market for those chips to maintain US business dominance in AI \u2013 without giving up the cream-of-the-crop chips to China, which administration officials say could still pose a national security threat.\n <\/p>\n \n China\u2019s mounting concern about the security of the chips comes after the White House last month recommended implementing export controls<\/a> that would verify the location of advanced artificial intelligence chips. China\u2019s cyberspace regulator late last month summoned<\/a> Nvidia over security concerns about \u201ctracking and positioning\u201d and \u201cremote shutdown\u201d capabilities.\n <\/p>\n \n In a blog post<\/a> published last week, Nvidia reiterated that its chips did not have back doors, spyware or kill switches and said that \u201cembedding backdoors and kill switches into chips would be a gift to hackers and hostile actors.\u201d\n <\/p>\n \n China\u2019s security concerns appear to mirror those that the US has in the past expressed about Chinese technology, most prominently the first Trump administration\u2019s campaign against the growing foothold of Chinese tech giant Huawei in global communications infrastructure.\n <\/p>\n \n Chinese leaders have also pushed for the country\u2019s tech firms to become self-sufficient and reduce reliance on American-made chips to achieve Beijing\u2019s AI and tech ambitions, and experts have said that controls on chips like the H20 could push China to speed up its own innovation.\n <\/p>\n \n But the H20 is not the only technology that reports suggest is entangled with negotiations between the two sides.\n <\/p>\n
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