US Approves Nvidia H200 AI Chip Sales
to Chinese Firms Despite Concerns Over Empty Offices and Military Links
The Commerce Department has approved dozens of Chinese companies to handle
Nvidia’s H200 chips, some of which have ties to firms under sanctions over national
security.
·
US Approval for Chinese Companies: The US Commerce Department
has reportedly approved approximately two dozen Chinese companies to purchase or
handle Nvidia's advanced H200 artificial intelligence (AI) chips.
·
Concerns Over Shell Companies: Investigations found that
some approved companies, including New Matrix, appeared to have no genuine physical
business operations at their registered addresses, raising questions about their
actual ownership and activities.
·
Links to Blacklisted Entities: New Matrix's owners reportedly
have connections with Wise Road, a Chinese private equity firm placed on the US
Commerce Department's Entity List in 2024 over concerns about acquiring strategically
sensitive semiconductor technology.
·
Another Suspicious Company: Maginfra,
another Chinese company approved to handle H200 chips, was also found operating
from an apparently deserted office. Analysts believe it may be linked to Inspur,
a Chinese technology company blacklisted by the US for its alleged military connections.
·
Military-Linked Corporate Networks: Several other approved
Chinese companies reportedly have ownership or business connections with organisations supplying cloud computing, semiconductor and telecommunications
technologies to China's military establishment.
·
Companies Under Scrutiny: These include Zhejiang Yindun Cloud Technology and Shanghai Jiatang,
whose corporate networks have links to military-related cloud computing and state-owned
telecommunications enterprises.
·
Trump Administration Eased Export Restrictions: President
Donald Trump relaxed certain restrictions imposed during the Biden administration
and permitted Nvidia to sell its H200 chips to China in December 2025, subject to
specified conditions.
·
25% Tariff on Chip Sales: Under the arrangement, Nvidia's
H200 chips manufactured in Taiwan must be routed through the United States, allowing
the US government to collect a 25% tariff on their value.
·
Major Chinese Technology Buyers: Approved companies reportedly
include Baidu, BYD, Tesla Shanghai, Alibaba, Tencent, ByteDance and ZTE, among others.
Collectively, they received permission to purchase tens of thousands of chips each.
·
US National Security Concerns: Former White House National
Security Council official Liza Tobin questioned whether the Commerce Department
and Nvidia were conducting adequate due diligence to ensure compliance with export
licence conditions.
·
US Government's Defence: The Commerce Department stated
that it carefully examines export licence applications
for national security risks and has strengthened enforcement through additional
officers and penalties for export violations.
·
Limited Nvidia Sales to China: Despite China's potential
as a major AI market, Nvidia's H200 shipments to Chinese customers accounted for
less than 1% of its data-centre revenue in the quarter
ending July 2026.
·
Risk of Technology Diversion: US authorities remain concerned
that Chinese companies could obtain restricted Nvidia chips through intermediary
companies and data centres operating in Southeast Asian
countries.
[ABS News Service/09.11.2026]
In a recently built industrial park
on the northwest fringe of Beijing, the listed address of a company called New Matrix
stands empty, a hollow gray shell with wires dangling
from the ceiling where lights should be.
Earlier this year, the Trump administration
approved this Chinese firm to assemble Nvidia’s advanced chips into the computers
that create artificial intelligence. President Trump allowed the sale of the chips,
called the H200, to China late last year. But before they could be sold, the Commerce
Department was required to review the companies involved for national security risks.
New Matrix passed that review. Yet
recent checks by The New York Times found that, within China, there is little evidence
the firm actually exists, raising questions about who in China is behind the company.
Only scant information can be found
online about New Matrix, which was created 17 months ago. At the building that New Matrix lists as its address, a company directory does
not include the firm. At the nearby property management agency for the industrial
park, a receptionist and a manager both said they had no record of the company.
According to Chinese corporate records,
New Matrix’s owners have ties to a prominent Chinese private equity fund that the
U.S. government placed on a trade blacklist in 2024. Two analysts who examined the
corporate records and other Chinese-language information said they believed New
Matrix may be a front for firms associated with that fund.
The sale of chips to New Matrix appears
to be part of a pattern that has concerned technology experts inside and outside
the government: The Commerce Department is giving clearance to buy and handle Nvidia’s
chips to Chinese companies with ties to firms that have been subject to national-security-related
trade restrictions.
Nvidia’s chips are the crucial technology
in A.I. data centers and now one of the world’s most coveted
commodities. They are also at the heart of the economic and geopolitical competition
between the United States and China.
Corporate records show that several
other Chinese companies approved to purchase H200 chips or assemble them into servers
have ties to firms that have been blacklisted by the U.S. government, or that work
as military contractors in China.
Liza Tobin, the former China director
for the White House National Security Council in the first Trump and Biden administrations,
said the approvals raised questions about how rigorously the Trump administration
is policing who can get their hands on Nvidia’s chips.
“I have a ton of concerns that neither
the Commerce Department or Nvidia is doing the due diligence needed to ensure that
the licensing terms are being followed,” she said.
During the Biden administration, the
United States began more broadly restricting sales of A.I. chips to China out of
concern the technology would help China advance militarily. But Mr. Trump eased
some of those limits after lobbying by Nvidia’s chief executive, Jensen Huang, with
whom he has grown close during his second term.
In December, Mr. Trump gave Nvidia
permission to sell the H200, an older but still powerful
A.I. chip, to China, as long as the U.S. government was given a cut of the sales.
In an unusual arrangement, Mr. Trump
is requiring these chips, which are assembled in Taiwan, to be routed through the
United States on their way to China, so that the government can collect a 25 percent
tariff on their value.
Nvidia is now selling only small amounts
of H200 chips to China. The Chinese government has been slow to
approve its companies for the purchases, partly because
it is trying to promote domestically made chips.
In total, the Commerce Department
appears to have approved roughly two dozen Chinese firms to buy or handle Nvidia’s
H200 chips, including major Chinese companies like Baidu, BYD and Tesla Shanghai,
according to people familiar with the approvals. The firms received approval to
purchase tens of thousands of the chips each, but have not yet met that quota, the
people said.
Reuters previously reported that the Commerce
Department had approved major Chinese companies like Alibaba, Tencent, ByteDance and ZTE Kangxun Telecom
for the licenses.
A spokesman for the Bureau of Industry
and Security, which reviews licenses inside the Commerce Department, said it carefully
reviews all applications for national security risks. The agency also said it had imposed $324 million of penalties
on companies for export violations in 2025 and hired more than 90 officers this
year to enforce technology rules.
New Matrix did not respond to requests
for comment.
John Rizzo, a spokesman for Nvidia,
said that “it makes no sense for the Chinese military to depend on American technology,”
and that Nvidia sells the “the first, best and most of our technology in America.”
He added that the Chinese government
has strictly limited imports of the H200 in favor of its
own chip companies, but that even Nvidia’s limited sales of the chip support American
jobs and manufacturing.
Although China is a potentially huge
market for A.I. technology, sales directly to the country currently account for
only a tiny percentage of Nvidia’s revenue. In the quarter that ended in July, H200 shipments to customers based in China made up less
than 1 percent of Nvidia’s revenue from data centers.
The company also said in August that it was not assuming any sales to China in its
estimate for data center revenue for the current quarter.
But many Chinese companies are gaining
access to Nvidia chips through data centers in Southeast
Asia, and the chips still appear to be a critical focus
for Beijing. The Times reported last month that Mr. Huang of Nvidia had a close
relationship with a woman who American spy agencies concluded was an intelligence
asset for China. The company she worked at, Megaspeed, operated data centers in
Southeast Asia that served Chinese clients and was being investigated for smuggling
some chips into China. On Sunday, Nvidia said
that it was opening an investigation into Mr. Huang’s relationship with the woman
after he acknowledged to the company’s board that he had been intimate with her.
When the Commerce Department granted
its approval to New Matrix this year, the company’s registered address was at a
compound on the outskirts of Beijing used for corporate registrations, where thousands
of other firms are also registered on paper, according to the Chinese corporate
information site Qichacha. But this fall, New Matrix’s
address changed to the empty office in the industrial park visited by The Times.
New Matrix’s website does not name
any staff members, advertise any jobs or include information about its history,
as of Nov. 6. But two of its primary owners appear in the records of companies connected
to a Chinese private equity firm under sanctions and its founder, a man named Li
Bin, according to WireScreen, a data platform.
In 2024, the U.S. government added
the private equity firm, Wise Road, to the Commerce Department’s “entity
list,” which restricts companies from doing business
with the United States. The department said Wise Road had helped the Chinese government
acquire strategically sensitive companies with chip technology.
Mr. Li is also the chairman of Tsinghua
Unigroup, a technology conglomerate with government ownership.
In 2021, one of Tsinghua Unigroup’s subsidiaries, New
H3C Semiconductor Technologies, was added to the entity list for working with the Chinese military.
New Matrix is the second Chinese company
approved to handle Nvidia’s H200 chips that does not seem to have any physical presence
at its listed address.
In September, The Times
reported that another recently created Chinese firm
called Maginfra had also received a license for H200s.
Like New Matrix, Maginfra appears to have been approved
not as the ultimate buyer of the chips, but as a company that would assemble them
into A.I. servers for another customer.
But when a Times reporter visited
Maginfra’s listed address in China in September, it also
appeared deserted. A few chairs and empty desks sat inside a small locked room with
no signs. Workers on the floor said they had not seen anyone use the office, and
building receptionists said they had not heard of Maginfra.
Analysts said they believed Maginfra was an offshoot of Inspur, a company whose headquarters
were near Maginfra’s listed address. The U.S. government
has added Inspur to the entity list for working with the Chinese military. Maginfra and Inspur share personnel and patents, and both have
government ownership.
Other Chinese companies that have
been approved for licenses to buy Nvidia’s H200 chips also have ties through their
corporate owners to military suppliers, according to people familiar with the approvals
and documents viewed by The Times.
One, called Zhejiang Yindun Cloud Technology, has ties to a cloud computing giant
that has sold services to military contractors, called Range Intelligent Computing
Technology Group. Yindun is partly operated from a data
center owned by Range, and several of its executives are
family members of Range’s founder.
Range serves as the cloud computing
provider for a satellite program run by the defense bureau
of Hebei province, which it has described on its website as serving the strategic
needs of “national defense development.” It also started
a subsidiary in 2016 to focus on quantum communications for the Chinese government
and military. Part of the subsidiary is owned by a firm that the United States added
to the
entity list in 2021 for acquiring American items for
the Chinese military.
Another company licensed to purchase
H200 chips, Shanghai Jiatang, grew out of a state-owned
enterprise called Datang Telecom, a chipmaker that provides
technology to the Chinese military. Datang is controlled
by the China Academy of Telecommunications Technology, a state-owned enterprise
that has developed cryptography for the Chinese military.
Shanghai Jiatang,
Yindun Cloud and Maginfra did
not respond to requests for comment.