China has asked some of its technology companies to stop placing orders for Nvidia’s H200 artificial intelligence (AI) chips, The Information reported, citing people familiar with the matter.
The move comes as Chinese authorities review whether these high-end US-made chips should be allowed into the country, and under what conditions.
Why China asked to pause Nvidia chip orders?
According to the report, Beijing is worried that Chinese companies may rush to stockpile US chips before the government makes a final decision. By asking firms to pause orders, China wants to keep control over how many foreign chips enter the country.
China is also expected to push companies to buy more domestically made AI chips, along with any foreign chips they purchase.
How is the demand for Nvidia chips in China?
Nvidia CEO Jensen Huang said earlier this week that demand for the H200 chip in China remains strong. Speaking at the Consumer Electronics Show, he said the company is treating purchase orders as a sign of approval rather than waiting for a formal announcement from Beijing.
Nvidia has unusually tightened its chip supply to China. According to the report, Nvidia is now asking Chinese customers to pay the full amount upfront for H200 chip orders. Orders cannot be cancelled, refunded or changed after being placed.
In some cases, buyers may offer insurance or assets instead of cash. These strict terms are meant to protect Nvidia, as China has not yet clearly approved the shipments. Earlier, Chinese clients were allowed to pay only a deposit, but the new rules come amid rising regulatory uncertainty.
US-China tech ties
US and China are locked in a tech race. Advanced semiconductors used for AI have become a major point of conflict. While the US has tightened controls on chip exports, China is trying to reduce its dependence on US-designed technology.
Nvidia continues to face pressure from both sides. The US controls exports of advanced chips, while China is still deciding whether to allow their use.
Late last year, US President Donald Trump’s administration allowed Nvidia to export H200 chips to China.
However, the approval came with a condition. Nvidia must pay a 25 percent revenue-sharing tax to the US government for these sales. The US also maintained that it is not exporting its best chips to China.
