US democrats probe Nvidia chip exports to China
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Washington, Nov 13 (IANS) Two senior congressional Democrats opened an inquiry into the Trump administration’s approval of advanced Nvidia chip exports to China, questioning the legality of a tariff arrangement and asking Commerce Secretary Howard Lutnick to preserve related records.
Representative Richard Neal, the top Democrat on the House Ways and Means Committee, and Senator Ron Wyden, his counterpart on the Senate Finance Committee, said the arrangement raised questions about national security, export licensing and the administration’s use of tariff powers.
The lawmakers challenged a system under which, according to their letter, Nvidia’s Taiwan-manufactured H200 artificial intelligence chips would first enter the United States for a security review and an export licence before being shipped to China.
They said a 25 per cent tariff would be collected when the chips entered the United States. They argued that the arrangement effectively allowed the administration to take a share of Nvidia’s sales to China through an export tax disguised as an import tariff.
“The Trump Administration's ostensible attempt to mask an unconstitutional export tax as a national security tariff action—benefitting both Nvidia and the Chinese government—raises serious concerns within our Committees' jurisdiction over matters relating to taxation and tariffs,” they wrote.
The lawmakers’ argument about constitutionality is their interpretation, not a court ruling.
Neal and Wyden also questioned whether the Commerce Department had adequately examined the Chinese companies receiving permission to buy the chips. Citing press reports, they said some approved buyers had links to the Chinese government or military.
They said they had “serious questions about whether the Commerce Department has been engaging in basic due diligence prior to issuing export licenses for advanced AI chip sales to Chinese companies.”
The lawmakers also asked whether political considerations had improperly influenced export policy. Their letter cited press reports in raising questions about the administration’s handling of national security concerns. The allegations are not findings of the congressional inquiry.
Their request covers records relating to the Commerce Department’s investigation of semiconductor imports under Section 232 of the Trade Expansion Act of 1962 and the resulting tariffs. It also seeks preservation of records concerning Nvidia export-licence applications and departmental communications with or about Nvidia, Jensen Huang and their representatives.
The letter reminded Lutnick of federal criminal prohibitions against destroying records relevant to congressional investigations.
Nvidia separately announced a leadership transition on Thursday. In a filing with the Securities and Exchange Commission, the company said its board had accepted Huang’s resignation as chief executive on Wednesday, effective immediately.
House Foreign Affairs Committee Democrats also called for a congressional briefing on the matter. “At a minimum, Congress needs to be briefed immediately,” they wrote on X.
The lawmakers’ letter asks Commerce to preserve records, while the separate committee Democrats’ statement calls for a briefing. Neither action itself halts chip exports or orders the department to produce documents.
Section 232 allows the president to adjust imports following an investigation into their effect on national security. Neal and Wyden argued that the authority was intended to address threats from imports, not facilitate exports they consider a security risk.
Representative Richard Neal, the top Democrat on the House Ways and Means Committee, and Senator Ron Wyden, his counterpart on the Senate Finance Committee, said the arrangement raised questions about national security, export licensing and the administration’s use of tariff powers.
The lawmakers challenged a system under which, according to their letter, Nvidia’s Taiwan-manufactured H200 artificial intelligence chips would first enter the United States for a security review and an export licence before being shipped to China.
They said a 25 per cent tariff would be collected when the chips entered the United States. They argued that the arrangement effectively allowed the administration to take a share of Nvidia’s sales to China through an export tax disguised as an import tariff.
“The Trump Administration's ostensible attempt to mask an unconstitutional export tax as a national security tariff action—benefitting both Nvidia and the Chinese government—raises serious concerns within our Committees' jurisdiction over matters relating to taxation and tariffs,” they wrote.
The lawmakers’ argument about constitutionality is their interpretation, not a court ruling.
Neal and Wyden also questioned whether the Commerce Department had adequately examined the Chinese companies receiving permission to buy the chips. Citing press reports, they said some approved buyers had links to the Chinese government or military.
They said they had “serious questions about whether the Commerce Department has been engaging in basic due diligence prior to issuing export licenses for advanced AI chip sales to Chinese companies.”
The lawmakers also asked whether political considerations had improperly influenced export policy. Their letter cited press reports in raising questions about the administration’s handling of national security concerns. The allegations are not findings of the congressional inquiry.
Their request covers records relating to the Commerce Department’s investigation of semiconductor imports under Section 232 of the Trade Expansion Act of 1962 and the resulting tariffs. It also seeks preservation of records concerning Nvidia export-licence applications and departmental communications with or about Nvidia, Jensen Huang and their representatives.
The letter reminded Lutnick of federal criminal prohibitions against destroying records relevant to congressional investigations.
Nvidia separately announced a leadership transition on Thursday. In a filing with the Securities and Exchange Commission, the company said its board had accepted Huang’s resignation as chief executive on Wednesday, effective immediately.
House Foreign Affairs Committee Democrats also called for a congressional briefing on the matter. “At a minimum, Congress needs to be briefed immediately,” they wrote on X.
The lawmakers’ letter asks Commerce to preserve records, while the separate committee Democrats’ statement calls for a briefing. Neither action itself halts chip exports or orders the department to produce documents.
Section 232 allows the president to adjust imports following an investigation into their effect on national security. Neal and Wyden argued that the authority was intended to address threats from imports, not facilitate exports they consider a security risk.
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Note: The content of this article is sourced from a news agency and has not been edited by the ap7am team.