Chinese universities, research institutes and other state-linked entities obtained advanced Nvidia chips by buying servers through little-known resellers, according to Reuters. Its April 23, 2024 report reviewed hundreds of Chinese tender documents. The documents show downstream purchases; they do not establish that Nvidia or the server manufacturers directly shipped restricted chips to the named buyers.
How the buyers obtained Nvidia chips
The tenders described servers made by Super Micro Computer, Dell Technologies and Taiwan’s Gigabyte Technology. Advanced Nvidia chips were inside those systems when Chinese entities acquired them from resellers. That is different from evidence that a manufacturer directly exported a restricted chip to a Chinese buyer: Reuters reported the purchases and listed sellers, but did not determine the chips’ supply path before resale.
The distinction matters because the United States bars Nvidia and its partners from selling advanced chips to China, including through third parties. A downstream purchase does not, by itself, show who supplied the hardware, when it entered the resale market, or whether a specific party violated export controls.
What Reuters found in the tenders
Reuters reviewed hundreds of Chinese tender documents. Its findings concern tenders whose winning bidders had been announced; the public databases it examined cover only a fraction of purchases by Chinese state entities.
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| Documented detail | What the report said |
|---|---|
| Buyers | Ten Chinese entities acquired advanced Nvidia chips in the tenders Reuters reviewed. Named examples included the Chinese Academy of Sciences, the Shandong Artificial Intelligence Institute, Hubei Earthquake Administration, Shandong and Southwest universities, and a Heilongjiang provincial-government-owned technology investment firm. The report also identified a state aviation research centre and a space science centre. |
| Sellers | Eleven little-known Chinese retailers were listed as sellers. |
| Timing | The tenders were fulfilled between November 20 and February 28, after the United States expanded export controls on November 17, 2023. Reuters could not establish whether the sellers drew on inventory acquired before the tighter controls. |
| Scale and value | The purchases involved several servers and several dozen chips. Tender values ranged from 71,500 yuan to 1.86 million yuan, which Reuters reported as about $10,000 to $259,000. |
| Intended use | The tenders did not state how the buyers planned to use the systems. |
What Nvidia, the server makers and Reuters could not establish
Nvidia said the tenders specified products exported and widely available before the restrictions. The company said: “They do not indicate that any of our partners violated the export control rules and are a negligible fraction of the products sold worldwide.” Nvidia also said it would work with customers if it determined a product had been resold in violation of U.S. export-control rules.
Super Micro described the systems in the identified tenders as “older generation or general purpose servers not capable of the largest scale AI operations” and said they had been available in China before the export-control regulations. Dell said it found no evidence that it had shipped products configured with the restricted chips to the named entities and would continue investigating. Gigabyte said it complied with Taiwanese laws and international regulations.
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Reuters did not determine whether the chips came from pre-control stockpiles, whether a manufacturer knowingly supplied restricted hardware, or what the buyers intended to do with it. The report also did not establish a direct shipment by any of the three server makers to the listed entities.
Were the purchases illegal?
The legal answer depends on the jurisdiction. The United States bars Nvidia and its partners from selling advanced chips to China, including through third parties. The report said the purchases and sales described in the tenders were not illegal under Chinese law at the time. Those statements do not resolve whether a particular export-control violation occurred: the reported documents do not show the chips’ full chain of custody or establish the conduct of each seller and supplier.
U.S. export-control violations can bring civil or criminal penalties, including fines of hundreds of thousands of dollars and up to 20 years in prison for individuals. Washington-based Kirkland & Ellis partner Daniel Gerkin told Reuters that enforcement could be challenging if a manufacturer had performed sufficient due diligence. That was a comment on a possible enforcement scenario, not a finding that any company in the report violated the rules.
Do the purchases prove Chinese military use?
No. Seven analysts and industry executives told Reuters that chips of this kind could support model training and advanced research. U.S. officials have warned that advanced chips can support military applications, including defense modernization and hypersonic-missile development. But the tenders did not state intended uses, and Reuters did not establish military use by any named buyer. The potential capability of a chip is not evidence of how a particular buyer used it.
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What the report means for readers
The documented issue is a route through resale: Chinese entities acquired servers containing advanced Nvidia chips after U.S. controls had been expanded. The report does not resolve whether the chips were already in inventory, how they moved through the supply chain, or whether any manufacturer breached export rules. For investors or customers assessing Nvidia, Super Micro, Dell or Gigabyte, the tender findings alone do not establish direct shipments, company liability, or the buyers’ intended use.
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