The U.S. announced charges for smuggling old Nvidia chips to China only hours before Trump gave the green light

By Steve Goldstein

Charges stemming from "Operation Gatekeeper" were announced on Monday.

Timing, as they say, is everything.

Only hours before President Donald Trump announced a reversal in policy, to allow the sale of older version of Nvidia microchips into China, the U.S. Justice Department announced charges for selling those very same chips into China. Neither Nvidia nor any of its employees were charged.

Two businessmen are now in custody and a Houston company and its owner pleaded guilty to smuggling what the Justice Department said were "cutting-edge artificial-intelligence technology out of the United States."

Specifically, they allegedly exported, or tried to export, at least $160 million worth of export-controlled Nvidia H100 and H200 graphic processing units. The Justice Department called the joint enforcement action "Operation Gatekeeper."

Now, those very same chips will able to be legally sold. "I have informed President Xi, of China, that the United States will allow NVIDIA to ship its H200 products to approved customers in China, and other Countries, under conditions that allow for continued strong National Security," said President Donald Trump in a social-media message.

The Justice Department press release made it sound like the chips were a threat to national security.

"They are designed to process massive amounts of data, advancing generative AI and large language models, and accelerating scientific computing. The GPUs are used for both civilian and military applications. These chips are among the most advanced GPUs ever developed, and their export to the People's Republic of China is strictly prohibited," the statement said.

The issue of alleged smuggling of Nvidia chips into China is one that has long surrounded the company. Nvidia in the last quarter redefined how it splits out revenue by region, in a move that now makes sales through Singapore less obvious.

Nvidia shares (NVDA) rose 2% in premarket trade. The stock has climbed 38% this year.

-Steve Goldstein

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

12-09-25 0514ET