The Trump administration on Tuesday gave a formal green light to China-bound sales of Nvidia's second most powerful AI chips, putting in place a rule that will likely kickstart shipments of the H200.

According to the regulations, the chips will be reviewed by a third-party testing lab to confirm their technical AI capabilities ‍before they can be shipped to China, which cannot receive more ⁠than 50 percent of the total amount of chips sold to American customers.

Nvidia will ‍need to certify there are enough H200s in the US, while Chinese customers must demonstrate "sufficient security procedures" and cannot use the chips for military purposes.

Nvidia and the Chinese Embassy in Washington did not immediately respond to requests for comment.

US President Donald Trump announced last month that he would allow the chip sales in exchange for a 25 percent fee for the ‍US government.

The decision drew fire from China hawks in the US over concerns the chips would supercharge Beijing's military and erode the US advantage in artificial intelligence.

Such concerns had prompted the Biden administration to bar sales of advanced AI chips to China. But the ⁠Trump administration, led by White House AI czar David Sacks, argues that shipping advanced AI chips to China discourages Chinese competitors from redoubling efforts to catch up with Nvidia's and AMD's most advanced chip designs.

When Trump announced the sales last month, he said they would be exported to China "under conditions that allow for continued strong National Security." (Reuters)