Democrats Open Inquiry Into Nvidia's China Chip Sales Under Trump Administration
U.S. congressional Democrats on Thursday opened an inquiry into how the Trump administration handled Nvidia's chip sales to China. It came hours after Nvidia ousted CEO Jensen Huang.
Democrats in the U.S. Congress on Thursday launched an inquiry into how President Donald Trump's administration handled sales of chips by Nvidia, the American maker of advanced semiconductors, to China. Earlier the same day, Nvidia removed its founder and CEO Jensen Huang. He also agreed to testify before separate, Republican-led congressional committees.
Why Huang was removed
Huang was ousted from the company he founded after admitting to an extramarital affair, following reports of a relationship with a woman accused of being a Chinese spy. He has since been accused of further affairs with Nvidia employees. The alleged spy, Alice Huang, was an executive at Megaspeed, a Singapore-based Nvidia customer that U.S. officials suspect of helping route advanced chips into China.
The Democrats' letter
The inquiry was started by Rep. Richard Neal, the top Democrat on the House Ways and Means Committee, and Sen. Ron Wyden, the top Democrat on the Senate Finance Committee. As the minority party, they can ask questions but cannot compel answers. In a letter to Commerce Secretary Howard Lutnick, they ask the department to preserve records on an arrangement they consider questionable and allege is illegal.
The letter describes a scheme in which Trump agreed to sales of H200 chips to China on condition that the chips were first shipped to the United States. On arrival, a tariff was added, which the letter says is effectively a cut of Nvidia's China sales through what appears to be an unconstitutional export tax system. The Commerce Department then issued an export license. The revenue-sharing arrangement itself was public: in August 2025, Nvidia and AMD agreed to give the U.S. government 15% of their China chip revenue to secure export licenses.
The lawmakers ask why Lutnick let Megaspeed keep buying chips after he was reportedly told of U.S. intelligence suspicions about Alice Huang. They also question why other Asian firms were reportedly approved despite having no physical presence at their listed addresses. The letter further notes that the deal was approved after Nvidia donated $26 million to Trump's projects, including the ballroom.
A second investigation
This is the second congressional probe since news of the alleged spy affair emerged. The Republican-led group includes the House Select Committee on the Chinese Communist Party, the House Committee on Foreign Affairs and the House Intelligence Committee. It demanded that Huang testify in a closed-door session and threatened a subpoena. After his ouster on Thursday, he agreed.
