The Commerce Department’s decision to allow NVIDIA to resume sales of its H20 artificial intelligence chips to China poses a serious threat to U.S. leadership in the emerging technologies space, the chairman of the House Select Committee on China warned on Tuesday.
The Trump administration initially banned the tech giant’s sale of the H20 chips to China in April as part of an extension of export controls designed to limit Beijing’s access to advanced semiconductors. NVIDIA had designed the H20 chip to comply with Biden-era restrictions, such as the AI diffusion rule, that otherwise blocked the sale of the hardware to China.
Last week, however, NVIDIA said it received the green light from Commerce to resume sales of the H20 chip to the Chinese market. Commerce Secretary Howard Lutnick said the decision was a part of negotiations with Beijing on the shipment of rare earth minerals.
In separate speeches at the Heritage Foundation and the Krach Institute for Tech Diplomacy, Rep. John Moolenaar, R-Mich., said the move would allow Beijing to substantially enhance its development of AI capabilities that could one day threaten U.S. national security.
“If the worst should occur, we never want to look back on an American military defeat enabled by [the People’s Republic of China’s] AI advances that were built on the back of American technology, like the H20 advanced chip, that far exceeded what China could have otherwise produced,” Moolenaar said at Tuesday’s Heritage event.
He expanded on his concerns during his Krach Institute speech, saying that he agreed with the basic premise of lifting the ban — “that selling H20s to China further extends U.S. technology as the global standard and provides valuable revenue for U.S. companies that will be used to invest in the next tech generation” — but that the main purpose of Beijing-focused export controls should be to keep the PRC from using American-made components to enhance its military capabilities.
Moolenaar noted that an April 2025 report released by his panel found that Chinese startup DeepSeek’s AI chatbot app was powered by export controlled NVIDIA chips, with the firm having access to roughly 30,000 H20 chips. The company’s app received widespread attention when it was released because it rivaled the capabilities of U.S.-based generative AI competitors, while being made at a fraction of the cost of similar models.
“DeepSeek’s free model is just the AI version of the CCP’s illiberal tech strategy,” he said. “If we are to win the AI race, we must be the global standard for both AI hardware and software, while ensuring the U.S. military, not the [People’s Liberation Army], has the advantage in AI.”
The congressman added that chip-focused export controls should examine how U.S.-made semiconductors compare with the capabilities that Chinese companies can produce on their own, which would allow tech firms to continue maintaining American AI leadership while keeping Beijing from gaining access to the most advanced chips.
“Doing so enables U.S. companies to retain market share, shape software ecosystems and set global AI norms,” Moolenaar said. “At the same time, it prevents the PLA from leapfrogging ahead with U.S. hardware that significantly outpaces their domestic capabilities.”
Tuesday’s speeches also came after Moolenaar sent a July 18 letter to Lutnick that said “rather than using U.S. capability as the benchmark for chip export controls, the Commerce Department should set a floating technical benchmark pegged to a slight technical improvement over current Chinese chip capability.”
