Democrats Open Inquiry Into Nvidia H200 China Sales

Congressional Democrats opened a formal inquiry Thursday into how the Trump administration handled Nvidia's chip sales to China — hours after the company ousted its founder-CEO, Jensen Huang, and he agreed to testify before rival Republican-led committees.

The inquiry, launched by Rep. Richard Neal of Massachusetts, the top Democrat on the House Ways and Means Committee, and Sen. Ron Wyden of Oregon, the top Democrat on the Senate Finance Committee, takes aim at Commerce Secretary Howard Lutnick and an arrangement the lawmakers call questionable — and, they allege, illegal.

As the minority party, Neal and Wyden can ask questions. They can't compel answers. But their letter to Lutnick demands the Commerce Department preserve records, and it lays out a mechanism in unusually blunt terms.

"The scheme worked like this," the letter says. President Trump agreed to allow sales of Nvidia's H200 chips to China on one condition: the Taiwan-manufactured chips had to be shipped to the United States first. Once they arrived, Trump added a tariff — "effectively taking a cut of Nvidia's sales to China through what appears to be an unconstitutional export tax system," according to the letter. Then Commerce, under Lutnick, issued the export license.

What was already public?

Here's the twist: the revenue-sharing core of this arrangement was never secret. In August 2025, Nvidia and AMD both agreed to hand over 15% of their China chip-sale revenue to the U.S. government as the price of securing export licenses, the AP reported at the time. One dollar in every seven of China revenue, routed to Washington before a single chip cleared customs.

The new questions go further than the deal itself.

Why did the scrutiny land now?

Huang was removed from the company he founded after he confessed to an extramarital affair amid reports of a relationship with a woman accused of being a Chinese spy. Since then, he has been accused of additional affairs with Nvidia employees.

The alleged spy, identified as Alice Huang, was an executive at Megaspeed — a Singapore-based Nvidia customer that U.S. officials suspect of helping route advanced Nvidia chips into China. The letter asks why Lutnick kept allowing Megaspeed to buy chips even after U.S. intelligence reportedly briefed him on their suspicions about Alice Huang and her relationship with Jensen Huang.

It also questions why the department reportedly green-lit other Asian companies to buy Nvidia chips "with no physical presence at their listed addresses." That detail widens the target: this inquiry aims at the administration, not just Nvidia and its fallen CEO.

Where do the donations fit?

The letter raises the money question directly. It notes that the export deal was approved after Trump learned of "Mr. Huang's compromised position" — the affair with an alleged spy — and after Nvidia donated $26 million toward Trump's projects, including the ballroom. The implication the lawmakers are probing: did Trump use his knowledge of the affair to secure donations from Nvidia?

One more data point hangs over the timeline. In a "60 Minutes" interview that aired Sunday, Trump described threatening an unnamed AI executive with jail — after which, he said, the executive "totally changed."

What does this change for Nvidia?

For the moment, leadership turmoil plus two Congressional investigations equals a compliance story with no clean exit. This is the second probe since the alleged spy affair broke. The first is Republican-led, run by leaders of the House Select Committee on the Chinese Communist Party, the House Committee on Foreign Affairs, and the House Intelligence Committee. That group demanded Huang appear for closed-door testimony and threatened a subpoena if he declined. On Thursday, after his resignation, he agreed to come voluntarily.

So Huang will testify — just not to the Democrats asking some of the hardest questions about how the export machine actually ran.

The H200 pipeline to China, the 15% revenue cut, the $26 million in donations and the licensing decisions all now sit inside a preservation order's reach. Whether Neal and Wyden get answers depends on a department that, so far, hasn't had to give any.