Nvidia RTX 4090 Graphics Cards Shipments Blocked to China by United States Government

America's Department of Commerce has blocked the shipments of RTX 4090 GPUs to China with ongoing tensions between the two countries. President and CEO of NVIDIA, Jensen Huang, warned the United States government earlier this year about a chip war upon blocking specific components to China. Despite the warning, the United States is still proceeding with the block with Nvidia H100, the chip responsible for most AI applications as well as the RTX 4090 GPUs. It will also result in the blocking of more NVIDIA chips like the A100, A800, H800, L40, and L40s. 

NVIDIA has stated that it will need a license from the United States government to sell RTX 4090 to China and many other countries, such as Saudi Arabia, the United Arab Emirates (UAE), and Vietnam.

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United States Government Blocks Specific Chip Shipment to China and Other Countries Due to Political Tension

NVIDIA discreetly mentioned the restriction status in a stock exchange filing on October 17, 2023. On the same day, the US Commerce Department announced strict rules regarding the prevention of advanced chip supplies to the Chinese government. According to the US Government, the block is from Nvidia selling GeForce RTX 4090 graphics cards to China due to the export ban intended to prevent the country from acquiring new and advanced AI chips.

With the current state of political laws and rules applied to the ban, NVIDIA may not be able to secure a license for China shortly. The US has crafted these export rules, keeping in mind that it will deny China the future opportunities to secure advanced AI chips. 

Earlier this year, the United States Commerce Department initially stated that it offered an exemption to allow companies to sell consumer-grade graphic cards to China. With the current ban, however, NVIDIA has noticed that the RTX 4090 exceeded specific performance thresholds. The Commerce Department was quick to notice this, as this was designed to fix the loopholes in the US chip ban against the country. 

Why is the Chip War a Huge Deal?

Advanced AI chips are the most strategic asset for both countries. Taiwan is a critical asset for the entire world when it comes to the global supply of semiconductors, NVIDIA's most popular outsource hub for its flagship chips, A100 and H100. With an export ban for RTX 4090 Chips, Taiwan can leap towards a chip war, resulting in price hikes and scarcity of these chips in the West and other parts of the globe.  It is yet to be seen how both countries handle their political tension and determine the future of the chip war.