China raised concerns over potential security risks in Nvidia’s H20 artificial intelligence chip, casting uncertainty over the U.S. company’s sales prospects in China weeks after a U.S. export ban was reversed.
The Cyberspace Administration of China, the country’s internet regulator, said it was concerned by a U.S. proposal for advanced chips sold abroad to be equipped with tracking and positioning functions. It said it had summoned Nvidia to a meeting on Thursday to explain whether its H20 AI chip had any backdoor security risks, as it was worried that Chinese user data and privacy rights could be affected. Nvidia did not immediately respond to a Reuters’ request for comment. In May, U.S. senator Tom Cotton introduced a bill that would direct the Commerce Department to require location verification mechanisms for AI chips subject to export restrictions, to curb Chinese access to advanced U.S. semiconductor technology. Nvidia has been in the crosshairs of U.S.-China relations and China’s move comes shortly after the U.S. this month reversed an April ban on Nvidia selling the H20 chip to China. The company developed the H20 chip for the Chinese market after the U.S. imposed export restrictions on advanced AI chips in late 2023. “Nvidia chips are now dispensable for China. They can be easily put on the negotiating table,” said Tilly Zhang, an analyst with Gavekal Dragonomics. “China obviously has more courage and domestic substitution capabilities compared to previous years to not rely on overseas technology.” This month, Nvidia CEO Jensen Huang embarked on a very public and effusive visit to China where he sought to demonstrate his commitment to the Chinese market, met with government officials and praised the country’s AI advances.

Full report : The Cyberspace Administration of China questioned Nvidia over H20 chip security concerns after US lawmakers urged adding tracking features to exported AI chips.