"U.S. Authorities Ask Nvidia to Investigate Leakage of Its AI Chip to China"

The U.S. Department of Commerce has asked artificial intelligence chipmaker Nvidia to investigate its chips that have leaked to China over the past year, according to Information Technology (IT) media Deformation.

Nvidia recently asked server companies such as SuperMicrocomputer and Dell Technologies to conduct on-site inspections of its Southeast Asian customers, after the U.S. Commerce Department asked Nvidia to investigate the illegal distribution of its chips in China, the sources said.

Servers manufactured by these companies are equipped with Nvidia's AI chips.

The Commerce Department's request comes as Nvidia's chips have allegedly flowed into China despite strong U.S. authorities restrictions on AI chip exports to China.

Dozens of Chinese state agencies were found to have purchased Nvidia chips even after the U.S. government imposed export controls in January, Reuters reported, citing related bidding documents.

The sources explained that for some SuperMicro customers, the Nvidia chip makes tracking of the chip difficult by replicating the serial number of the embedded server and attaching it to another server or changing the serial number.

"We call on our customers and partners to strictly adhere to all export control restrictions," Nvidia said in response, adding that reselling without permission from manufacturers or official distributors would only weigh on our business and would not be profitable.

"We require distributors and resellers to comply with all relevant regulations and export controls," Dell Technologies said. "For non-compliant partners, we will take appropriate action, including termination of our contractual relationship."

The Commerce Department announced export controls in October 2022 that comprehensively restricted exports of advanced semiconductor equipment or AI chips using U.S. technology to China, and in October last year banned exports of low-end AI chips to China.