Nvidia, and AMD have agreed to the US government to give 15 per cent revenue from sales of advanced computer chips like N20’s H20, which is used for artificial intelligence applications, an American official told Reuters on Sunday.

US President Donald Trump’s administration stopped the sale of H20 chips to China in April, but Nvidia last month announced the US that it would allow the company to resume sales and it expects to start delivery soon.

Another American official said on Friday that the Commerce Department had started issuing licenses to China for the sale of H20 chips.

Asked if Nvidia agreed to pay 15 percent revenue to the US, a spokesman from NVidia said in a statement, “We follow the rules set by the US government for our participation in markets around the world.”

The spokesperson said: “While we have not sent H20 to China for months, we hope that the export control rules will let America compete in China and worldwide.”

AMD did not respond to a request for comment on the news, which was first reported by the Financial Times on Sunday. The US Department of Commerce did not immediately respond to the remarks request.

The Financial Times stated that chipmakers agreed to arrange the arrangement as a condition to obtain an export license for their semiconductor, including AMD’s Mi 308 chips. The report said that the Trump administration was yet to determine how to use the money.

“It’s wild,” Jyoff Gartz, a senior partner of the center for the New American security, said, an independent think tank in Washington, DC.

“Either selling H20 chips to China is a national security risk, in which we should not do to start it, or it is not a national security risk, in which case, why are we putting this additional punishment on sale?”

US Commerce Secretary Howard Lutnik stated that last month was part of the US dialogue with China to achieve rare Earth from the launch of the sale of AI chips and described H20 as NVidia’s “Fourth-Serviceant Chip” in an interview with CNBC.

Lutnik stated that American was in American interests for Chinese companies using American technology, even though the most advanced exports were banned, so they continued to use an American “tech stack”.

The US official said the Trump administration did not feel the sale of H20 and equivalent chips were compromising on US national security. The officer did not know when the agreement would be implemented or in fact, but said that the administration would be in compliance with the law.
The move was criticized by the former President Joe Biden’s Advisor in the Department of Commerce during the administration of Biden.

“If this reporting is correct, it suggests that the administration is removing national security security for the Treasury,” the Philips-Robins said.