Chinese regulatory authorities have accused Nvidia of detecting “backdoors” in the H20 artificial intelligence chips, which were approved for supply to the Chinese market following relevant decisions by the U.S. government. According to official statements, the functions found in the chips allegedly allow for remote tracking of device locations, as well as remotely shutting them down.
This is reported by Business • Media
Legal Demands and Impact on Nvidia’s Business in China
The Cyberspace Administration of China (CAC) has summoned Nvidia to court, demanding clarification and complete documentation regarding the identified security violations. This situation has created risks for Nvidia’s plans to revive its business in China, as the H20 was specifically developed to circumvent U.S. export restrictions and was set to become a key product for the company in the local market. It is known that after receiving the supply permit, Nvidia’s CEO Jensen Huang visited Beijing to personally assure customers of the safety and reliability of the products, as well as to present the new GPU from the Blackwell line, which complies with U.S. export regulations.
Expert Reactions and Consequences for the Chip Industry
At the same time, technology experts express doubts about the validity of the accusations. In particular, analyst Paul Triolo points out the lack of public evidence and detailed information about the sources of analysis and the results of Chinese testing.
“The H20 was created to bypass U.S. export restrictions and was set to become a key product for Nvidia in the Chinese market. After the lifting of the supply ban, CEO Jensen Huang personally visited Beijing. He assured customers of the company’s reliability and presented the new Blackwell series GPU, which complies with Washington’s regulations.”
So far, Nvidia has not provided official comments regarding the accusations. Against this backdrop, Beijing is intensifying its import substitution policy in the high-tech sector: large companies are strongly encouraged to increase purchases of domestic chips. This opens additional opportunities for manufacturers such as Huawei, Biren, and Cambricon, which receive government support for the development of the national AI industry.
Meanwhile, discussions continue in the U.S. regarding a bill that could require Nvidia and other chip manufacturers to integrate tracking systems into exported processors. Opponents of the initiative warn that such actions could accelerate the development of the Chinese AI market and create additional risks for U.S. national security.
Experts emphasize that the situation remains uncertain: production of the H20 chips has resumed, but it may take up to nine months before mass deliveries to customers begin. In both the U.S. and China, there are influential forces opposing the implementation of the deal. The American side is driven by security considerations, while Beijing aims to accelerate the transition to an independent chip industry.