China allows DeepSeek to buy NVIDIA's H200 AI chips
What's the story
China has conditionally approved its leading AI start-up, DeepSeek, to purchase NVIDIA's H200 artificial intelligence chips. The approval comes with regulatory conditions that are still being finalized. The move is part of a larger trend as ByteDance, Alibaba, and Tencent have also been permitted to buy over 400,000 H200 chips in total.
Approval details
Regulatory conditions for AI chip purchases
China's industry and commerce ministries have approved the purchases of H200 chips by DeepSeek, ByteDance, Alibaba, and Tencent. However, they have also imposed regulatory conditions that are still being finalized. These conditions are being determined by China's state planner, the National Development and Reform Commission (NDRC).
Geopolitical implications
H200 chip: A flashpoint in US-China relations
The H200, NVIDIA's second most powerful AI chip, has become a major flashpoint in US-China relations. Despite strong demand from Chinese companies and US approval for exports, Beijing's reluctance to allow imports has been the main obstacle to shipments. Earlier this month, the US formally approved NVIDIA's sale of the H200 to China. However, whether it would be shipped in is still up to Chinese authorities.
Legislative oversight
US scrutiny on DeepSeek's AI chip purchases
Any purchase of H200 chips by DeepSeek could come under the watchful eye of US lawmakers. A senior US lawmaker has alleged that NVIDIA helped DeepSeek refine AI models that were later used by the Chinese military, according to a letter sent to US Commerce Secretary Gina Raimondo. This allegation highlights the potential national security concerns associated with such transactions.