Nvidia and AMD will pay a 15% technology fee in the US to sell their chips in China.

Nvidia and AMD have agreed to deliver 15% of their revenue from chip sales in China to the US government as part of an unusual agreement with the Trump administration to obtain export licenses. The two companies accepted this financial commitment as a condition for receiving licenses for the Chinese market, which were granted last week. Nvidia will contribute 15% of the revenue from sales of its H20 chip in China, while AMD will do the same with the revenue from the MI308 chip.

The Commerce Department began issuing licenses for H20 two days after Nvidia CEO Jensen Huang met with Donald Trump, according to the Financial Times . Permits have also begun for AMD's chip destined for China.

Export control experts call the agreement "unprecedented," as no U.S. company has previously agreed to pay a portion of its revenue to obtain a license . However, it fits the pattern of the Trump administration, in which the president pressures companies to make domestic investments or other measures in exchange for avoiding sanctions or tariffs, with the goal of attracting jobs and revenue to the country.

Nvidia didn't deny the deal, stating, "We follow the rules set by the US government for participating in global markets." Analysts at Bernstein estimate that, based on Nvidia's forecasts before the restrictions, it would have sold around 1.5 million H20 chips to China by 2025, generating around $23 billion.

The deal follows the controversy over H20, which was specifically designed for China after President Biden imposed controls on advanced artificial intelligence chips . In April, the Trump administration announced it would ban the export of H20, but the president reversed course in June after meeting with Huang. Weeks later, Nvidia expressed concern that the Bureau of Industry and Security (BIS) was not issuing licenses. The matter was raised directly with Trump, and two days later, BIS began issuing permits.

The pact has drawn criticism from national security experts who warn that H20 could strengthen Chinese military capabilities and weaken the US position in artificial intelligence. Liza Tobin, a former National Security Council official, quipped: "What's next? Allow Lockheed Martin to sell F-35s to China for a 15% commission?"

Several BIS members have also expressed concerns. In a recent letter to the Secretary of Commerce, 20 experts, including Matt Pottinger, called for H20 not to be licensed, calling it a "potent accelerator" for Chinese AI with potential military use. Nvidia rejected this interpretation and argued that the chip cannot be used for military purposes.

In a statement, Nvidia said: "While we haven't shipped H20 to China in months, we hope the export rules will allow the US to compete in China and around the world. We can't repeat the mistake of losing our leadership, as we did with 5G. US AI technology can become the global standard if we compete vigorously."

The debate over export control policy comes amid ongoing trade talks between Washington and Beijing, which Trump hopes will lead to a summit with Xi Jinping. The Commerce Department has reportedly been ordered to freeze further restrictions to avoid tensions with China. Beijing, for its part, is seeking to relax controls on HBM memory chips, essential for manufacturing advanced AI semiconductors.