Commerce Chief Enforces Rigid H200 Export Rules, TSMC to Ramp Q2 Output
U.S. Commerce Secretary Howard Lutnick enforced strict, non-negotiable licensing terms for Nvidia's H200 AI chip exports to China, delaying final clearance pending a national security review. Excess Chinese orders have led Nvidia to press Taiwan Semiconductor Manufacturing Co. to raise H200 production capacity in Q2 2026.
1. Enforced Licensing Terms
Commerce Secretary Howard Lutnick announced that Nvidia must comply with detailed, non-negotiable licensing requirements for its second-most-advanced H200 AI chips sold to China. These conditions, developed with the State Department, restrict China’s military access and leave no scope for negotiation, effectively pausing shipments until full compliance is confirmed.
2. Export Approval Delay
Although a presidential agreement was reached last October to resume H200 exports, final clearance remains pending a comprehensive national security review. Nvidia’s proposed safeguards have not yet satisfied regulators, prolonging uncertainty over shipment schedules despite initial approvals for China’s major internet firms to import the first batch.
3. TSMC Production Ramp-Up
Record Chinese demand has exceeded Nvidia’s available H200 inventory, prompting the chipmaker to contract Taiwan Semiconductor Manufacturing Co. to boost production. TSMC is set to scale up H200 wafer runs in the second quarter of 2026 to address order backlogs and capitalize on the surge in AI hardware requirements.