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US President Donald Trump’s plan to grant Nvidia licenses to ship some of its most powerful artificial intelligence chips to China is ruffling the feathers of some of Washington’s most prominent China hawks, including members of his own party.
The backlash intensified this week with the US House Foreign Affairs Committee proposing a Invoice which seeks to expand congressional oversight of AI chip exports.
The proposal, known as the AI Overwatch Act, was introduced last month by Rep. Brian Mast, R-Fla., the committee’s chairman.
It would require the House Foreign Affairs Committee and the Senate Banking Committee to approve any license to ship advanced chips within 30 days, giving lawmakers the power to block sales through a joint resolution.
The bill comes as the Trump administration considers granting licenses allowing Nvidia to sell its H200 chips to China, which are far more powerful than processors previously authorized for export.
If passed, the AI Overwatch Act would revoke existing licenses for such AI chip transfers and impose a temporary ban until the administration submits a national security strategy on AI exports. It includes exemptions for “trusted” U.S. companies that ship chips overseas under U.S. control, provided they meet security standards.
“Companies like Nvidia are asking to sell millions of advanced AI chips, which are at the cutting edge of warfare, to Chinese military companies like Alibaba And Tencent“said President Mast, describing it as a risk to national security.
The bill was also co-sponsored by the Republican chairman of the Select Committee on China, Rep. John Moolenaar, R-Mich., who I called him a “crucial step toward protecting America’s technological edge.”
However, it is still unclear how much traction the AI Overwatch Act may have in the House and Senate.
Disagreement in WashingtonThe law is likely to serve as a linchpin in a broader battle unfolding in Washington between lawmakers who view Nvidia chip exports as a national security risk and officials who argue the exports help maintain U.S. technological dominance.
Among the latter camp are White House AI and crypto czar David Sacks, who has previously criticized the AI Overwatch Act. The Silicon Valley entrepreneur and investor recently republished a claim viral on social media that the bill would undermine Trump’s authority over AI chip exports.
Bags and those in the Trump administration who support more Nvidia shipments overseas have argued that U.S. restrictions on chips are counterproductive and have ceded ground to Chinese competitors.
Instead, they argue, it is beneficial for U.S.-designed chips to remain at the center of the world’s AI infrastructure. This is consistent with arguments made by Nvidia CEO Jensen Huang and industry lobbyists.
Bipartisan lawmakers on the other side, however, argued that Nvidia’s H200s could boost China’s AI capabilities and be exploited by its military.
Current controls on chips in the United States require individual licenses from the Commerce Department for any export or transfer of high-performance AI chips to entities located in “countries of concern,” including China, Cuba, Iran, North Korea and Russia.
These checks covered Nvidia’s H200, one of its most powerful AI chips. But last week, Trump confirmed his administration would approve the sales processors to China, provided the United States receives a 25% cut of revenue.
Pushback mounting Much of the resistance from lawmakers has come from the opposition party. In December, Senate Intelligence Committee Vice Chairman Mark Warner, Democrat of Virginia, criticized Trump’s approval of H200 exports, calling it evidence of a “haphazard, transactional approach” lacking a coherent strategy against China.
“US companies must remain the undisputed leader in AI hardware, because our strategic competition with China in AI will come down to the question of which ecosystem drives global adoption and innovation,” he said.
Meanwhile, Massachusetts Democrat Elizabeth Warren, a member of the Senate Banking Committee, also warned that China was seeking such chips for military modernization, weapons design and AI surveillance, citing Justice Department assessments.
However, Trump also faced bipartisan resistance. Before the H200, the president also announced that he would allow Nvidia to resume sales of the H20 to China, a chip that the president had restricted a few months earlier.
At the time, lawmakers also responded with additional AI chip proposals, including GAIN Act on AI, introduced in November by a bipartisan group including Warren and Sen. Tom Cotton, R-Ark. The bill would require U.S. companies to prioritize domestic sales of advanced chips before exporting to China.
Despite Trump’s chip export policy changes, Chinese regulators have not allowed Nvidia’s chips to enter the country freely.
Reuters reported Last week, Chinese customs authorities were instructed to block imports of H200 chips and warned technology companies not to buy them unless necessary.
