$16B H20 chip deal saved over steak? Trump backs off NVIDIA export ban after dinner
Despite months of planning, U.S. regulators halted new export controls on Nvidia’s H20 chip after the company vowed new domestic AI investments.
A high-profile dinner at Mar-a-Lago last week may have prompted a sharp U-turn in U.S. policy on AI chip exports to China.
NVIDIA CEO Jensen Huang, who reportedly paid $1 million to attend the exclusive event hosted by former President Donald Trump, was facing the imminent threat of new export restrictions on NVIDIA’s H20 chip — the most advanced AI processor the company can legally sell to China.
However, following the event, the Trump administration abruptly paused the planned controls, signaling a major shift in trade strategy.
US reversal came after NVIDIA’s investment promise?
According to a report by NPR, which cited two sources familiar with internal discussions, the Trump administration had spent months preparing new rules to block the sale of NVIDIA’s H20 HGX GPU to China.
These restrictions were expected to take effect as early as this week.
Yet following Huang’s appearance at Mar-a-Lago and NVIDIA’s subsequent pledge to invest heavily in domestic AI data centers, the White House decided to halt the new controls.
Although it’s unclear whether Huang spoke directly with Trump during the dinner, both sources say the expectation before the event had been that H20 exports would be shut down.
Chris Miller, a semiconductor expert at Tufts University, said:
Even though these chips are specifically modified to reduce their performance thus making them legal to sell to China — they are better than many, perhaps most, of China’s homegrown chips,
“China still can’t produce the volume of chips it needs domestically, so it is critically reliant on imports of NVIDIA chips.”
The H20 chip: Lifeline for China’s AI dreams
The H20 chip is built under tight U.S. export restrictions, designed to stay within legal performance limits while still being useful for AI inference tasks.
This process powers advanced models like DeepSeek, a Chinese AI chatbot that drew global attention earlier this year.
In response to growing tensions and the likelihood of new export restrictions, Chinese firms spent $16 billion in early 2025 to stockpile the H20 chip, The Information reported.
Lawmakers on both sides of the aisle have pushed for tighter controls.
Rep. Raja Krishnamoorthi, D-Ill, said:
Export controls work, and we don’t have time to waste,
“Every day America fails to restrict the export of chips designed to circumvent existing controls is a day that our adversaries have to build up stockpiles to defeat us.”
AI diffusion rule hangs like a looming threat
The temporary policy shift may offer NVIDIA some breathing room, but it’s unclear how long it will last.
The Biden-era AI Diffusion Rule, set to take effect May 15, will prohibit the sale of all U.S. AI processors to China regardless of performance tweaks or shipment size.
Under this framework, exceptions for low processing performance will not apply to high-risk countries like China, and licenses will be required for all exports — with denials being the default.
If NVIDIA hopes to continue selling H20 chips to Chinese companies beyond May 15, the Trump administration may need to modify or scrap the AI Diffusion Rule entirely, or issue special licenses to NVIDIA.
The White House and the Commerce Department have not commented on the issue, and NVIDIA has also declined to provide a statement.
The situation reflects the increasingly complex intersection of global AI leadership, trade policy, and national security — where a single dinner could shift the trajectory of a multi-billion dollar industry.
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$16B H20 chip deal saved over steak? Trump backs off NVIDIA export ban after dinner, source
