- Nvidia and AMD regain access to China’s AI chip sector with a 15% revenue levy to the US government.
- The deal follows previous export bans citing national security risks.
- Experts question whether the payment undermines the original security rationale.
After months of blocked sales, Nvidia and AMD have secured permission to sell certain AI chips to China — but at a cost. Under a new US export licensing arrangement, both companies must hand over 15% of revenues from these specific sales directly to the federal government.
The agreement comes after prior restrictions prohibited the export of advanced AI chips to China due to security concerns. Nvidia’s H20 and AMD’s MI308, designed to skirt earlier limits, were caught in a wider clampdown earlier this year.
Chipmakers Face 15% Revenue Toll to Regain China Sales
The US Bureau of Industry and Security has issued new export licenses to Nvidia and AMD, granting them the ability to resume selling their China-focused AI chips. In exchange, the companies will remit 15% of related sales revenues to Washington. This payment structure is a first in US export policy and has no prior precedent in the technology sector.
Industry analysts estimate that the restored market access could be worth billions to both firms. For Nvidia alone, projections suggest that Chinese sales of the H20 could have generated over $20 billion in 2025 without restrictions. AMD, while smaller in scale, also sees China as a critical market for its AI ambitions.
Critics argue that the move creates a policy contradiction. If the chips were considered a threat to US national security just months ago, they say, imposing a fee does not neutralize that risk. Instead, the decision raises questions about whether strategic trade controls can be swayed by economic incentives.
Supporters of the deal counter that the levy ensures the US government benefits financially from the transactions while still maintaining oversight of export conditions. They point to the competitive pressures from other global chipmakers, arguing that cutting off the Chinese market entirely could undermine America’s long-term influence in the AI hardware sector.
The 15% levy deal places Nvidia and AMD back in one of the world’s most lucrative AI markets — but at the cost of both revenue and clarity over US trade policy motives.
As Benjamin Franklin once said, “He that is of the opinion money will do everything may well be suspected of doing everything for money.”
