Congress moves to tighten chip export controls amid Nvidia controversy

Congressional leaders from both parties are working to add stricter export controls on advanced semiconductor technology to the year-end National Defense Authorization Act (NDAA). The effort follows revelations that Nvidia’s former chief executive, Jensen Huang, had a relationship with an alleged Chinese spy and that the company sold $4 billion in chips to Singapore-based Megaspeed, which is under Justice Department investigation for potentially diverting the technology to China.

Senate Majority Leader John Thune said there is a “high probability” that Congress will impose additional restrictions, while Senator John Kennedy described the chance as “better than even.” The three measures under consideration are the Chip Security Act, which would require location verification of shipped AI chips; the MATCH Act, aimed at closing loopholes in chip-making equipment exports to allied nations; and the AI Overwatch Act, which would treat chip sales to designated “countries of concern” similarly to foreign arms sales, giving Congress oversight of Commerce Department licensing decisions.

House Speaker Mike Johnson noted a “developing consensus in Congress” for tighter controls, and Rep. Mike Levin said the NDAA offers an opportunity to place “guardrails around AI.” Senate Armed Services Chair Roger Wicker and Senate Republican leader Chuck Schumer have expressed support for passing all three bills to limit China’s access to advanced technology.

Industry groups, including the Information Technology Industry Council, have opposed the proposals, arguing they could “undermine the American tech stack.” Nonetheless, AI firms Anthropic and OpenAI have signaled growing support. The legislation’s progress could be affected by separate Democratic efforts to attach provisions aimed at ending U.S. involvement in the war in Iran, which some Republicans fear may jeopardize the must-pass defense bill.