NVIDIA and AMD agree to pay us 15% of China’s chip export revenue | Technology Area

Chip Manufacturer Nvidia AMD has agreed to provide the U.S. government with 15% of its revenue from premium chips sold to China in exchange for export licenses to major markets.

The unprecedented move significantly reversed U.S. national security restrictions on chip sales, which showed that it had eased in the U.S.-China trade war.

Donald Trump has provided weapons for trade restrictions and tariffs to bring business to our shores. However, the Quid Pro arrangement first reported by the Financial Times may be unconstitutional.

The arrangement would result in NVIDIA earning 15% of its revenue from H20 chip sales in China and 15% of its sales of its MI308 chips in China, according to U.S. officials citing U.S. officials.

The U.S. government has tried for years to limit the supply of technology to China, which can be used in ways that threaten U.S. national security, especially the bargaining chips that can power artificial intelligence development and weapons.

Nvidia’s chips are The main driver of the boom of artificial intelligenceChina and the United States are very popular. Beijing has repeatedly criticized the bargaining restrictions and accused the United States of using technology and trade to “maliciously contain and suppress China.”

Although the H20 and MI308 chips were banned from being sold to China in April, the lower H20 was specially designed to comply with the restrictions introduced by Biden Administration.

But last month, Trump withdrew his ban, and the Commerce Department reportedly began issuing export licenses for the H20 last week, a move linked to China’s easing Earth’s export restrictions and an income-sharing agreement revealed on Sunday.

NVIDIA CEO Jensen Huang has visited Trump and amid a clear lobbying effort to address restrictions. Officials in Beijing In recent months, to Wednesday, we met with the U.S. president.

Trump praises Huang and Nvidia, the first company to own in July Its market value is through $4TN (£2.97tn)Even if it navigates U.S.-China trade war and other industry turmoil, including Trump’s 100% tariffs on foreign semiconductors.

“We comply with the rules of participation of the U.S. government in global markets. Although we have not shipped H20 to China for several months, we hope that export control rules will allow the U.S. to compete in China and globally,” NVIDIA said in a statement after the Financial Times report.

AMD has not commented on the deal.

NVIDIA’s statement responded to comments from U.S. Commerce Secretary Howard Lutnick last month that it is in the interests of the United States to have China using U.S. technology, and that the H20 is NVIDIA’s “fourth largest bargaining chip”. However, the deal shocked analysts.

“In addition to the policy issues that only charge NVIDIA, AMD’s revenues are 15% of its revenues to sell high-end chips for China, and the U.S. Constitution provides a violation of export taxes,” Peter Harrell, senior director of international economics at the Biden administration, said on social media.

Export controls remain, but the agreement threatens the credibility of control, especially in the EU and East Asia, where the United States has been lobbying for restrictions, said Ilaria Carrozza, a senior researcher at the Institute of Peace at Oslo.

“If we assume that these national security restrictions can be bypassed by paying some kind of fee to the government… then how can we make these export control credible?” she told the guardian.

Although Beijing officials said recent officials said both sides were working hard in recent speeches, a truce in the U.S.-China tariff war has not been announced yet.

Goldman Sachs said in a report on Monday that U.S. companies have absorbed most of the fees of Trump’s other tariffs to various countries, but consumers will soon be the first to bear the brunt.

In June, U.S. businesses were responsible for about 64% of tariffs and 22% of consumers, but are expected to flip, with consumers’ share expected to increase to 67%.

With Reuters