The U.S. Department of Commerce recently approved export licenses for two Chinese companies to buy Nvidia’s H200 AI chips. Tom’s Hardware reports that both firms list office addresses that, when visited, turned out to be vacant. Receptionists at the buildings said they had never heard of the companies, and no staff were present. The investigation also uncovered ties between the firms’ executives and other businesses that the United States has sanctioned for supplying advanced technology to the Chinese military. The finding raises questions about how thoroughly the Commerce Department checks each license request. Former White House National Security Council China director Liza Tobin told The New York Times that she worries both the department and Nvidia are not doing enough due diligence. She said the process looks like “rubber‑stamping” applications instead of probing deeper into possible military connections. Nvidia’s H200 chips are high‑end graphics processors designed for large language models and other demanding AI workloads. Because the U.S. restricts their export to certain foreign users, companies must obtain a license before buying them. The two firms in question were cleared earlier this year, but the new evidence suggests the approvals may have been granted without verifying the buyers’ actual operations. If the Commerce Department’s vetting is indeed lax, it could allow more technology to slip into supply chains that support China’s defense sector. That would run counter to the export controls put in place after several high‑profile sanctions against Chinese firms involved in military projects.
Background on the export controls
The United States began tightening export rules on advanced GPUs in 2023 after concerns that the chips could accelerate Chinese AI development for military use. Nvidia, as the leading supplier of such hardware, must obtain an export license for each foreign sale of its H200 chips. The Department of Commerce’s Bureau of Industry and Security is responsible for reviewing applications, looking for links to prohibited entities or activities. Critics say the agency has struggled to keep pace with the sheer volume of requests and the opaque corporate structures often used to mask true ownership. The recent discovery of empty offices adds to a growing list of cases where licensed buyers could not be easily identified, prompting calls for tighter scrutiny and more transparent reporting.
Why it matters
For anyone concerned about U.S. technology ending up in foreign military projects, this case suggests current export checks may miss key red flags. It also signals that companies buying advanced AI hardware could be harder to verify, potentially affecting future policy and enforcement around technology transfers.
