U.S. senators Elizabeth Warren and Jim Banks urged Congress on November 9, 2026, to tighten restrictions on exports of NVIDIA’s advanced chips to China. Their call followed reports of a possible intelligence operation targeting CEO Jensen Huang and renewed concern that U.S. technology could reach entities linked to China’s military.

In a joint statement, the lawmakers said: “In March, members of both parties urged the Department of Commerce to suspend or review NVIDIA’s export licenses for China and conduct a full national security risk assessment.”

They said NVIDIA had since reportedly received approvals to ship hundreds of thousands of advanced artificial-intelligence chips, including to organizations linked to China’s armed forces.

“Jensen Huang’s confirmation of a relationship with an alleged Chinese intelligence agent makes these concerns even more pressing,” the statement said.

Warren and Banks called for the AI Overwatch Act to be included in the U.S. defense budget for fiscal 2027. The measure would expand Congress’s authority to oversee exports of advanced semiconductors.

Lawmakers are also considering the Chip Security Act, which would require manufacturers to track chip shipments to counter smuggling, and the MATCH Act, which would tighten restrictions on exports of semiconductor-manufacturing equipment through allied countries.

“It is time for Congress to take decisive action to cut off China’s pathways to obtaining advanced chips,” the senators said.

Investigation and shareholder lawsuit

Huang admitted to marital infidelity after reports of an alleged affair with Alice Huang, a former executive at Singapore-based Megaspeed International. According to The New York Times, U.S. intelligence agencies suspect her of cooperating with Chinese intelligence, but her involvement in espionage has not been publicly proven.

Megaspeed, an NVIDIA customer, is also under U.S. government investigation over suspicions that it may have circumvented restrictions on exports of advanced chips to China.

NVIDIA’s board initiated an independent review of the alleged intelligence operation. The company said it had no current basis to believe that U.S. state secrets or NVIDIA’s confidential information had been compromised. Huang pledged to cooperate with the investigation and continue serving as CEO.

On November 9, shareholder Mark Kistenmacher filed a class-action lawsuit against NVIDIA and Huang in federal court in California. Kistenmacher alleges that the company misled investors about Huang’s ties to Megaspeed representatives and the associated business risks. The shareholders seek damages in an amount that has not been determined.

NVIDIA shares fell about 4.3% that day, reducing the company’s market capitalization by roughly $190 billion, according to a TradingView chart.

The dispute added to uncertainty after the U.S. midterm elections. Elon Musk had lost nearly $30 billion in estimated asset value amid a Democratic victory, as the party pushed for greater oversight of data-center construction.

Pressure also spread across the AI sector. On November 5, the Nasdaq fell 5.5%, NVIDIA declined 9.3% and AMD lost 17.3%. Investors feared infrastructure projects could slow because of political opposition, high financing costs and rising electricity expenses. U.S. stock indexes rebounded on November 9 even as NVIDIA fell further.

Export restrictions shifted under Trump

Washington has restricted Chinese companies’ access to technology that could support artificial-intelligence development and military systems. In April 2025, President Donald Trump’s administration imposed additional licensing requirements on exports of NVIDIA’s H20 processors, which were designed for the Chinese market to comply with existing U.S. restrictions.

Shortly before the controls were imposed, Huang met Trump over dinner at Mar-a-Lago. Media reports said the White House initially backed away from tighter controls after the meeting, partly amid NVIDIA’s promises to invest in U.S. AI infrastructure, but the restrictions were ultimately introduced.

After another meeting between Huang and Trump in July 2025, NVIDIA announced plans to resume H20 shipments to China and said U.S. authorities had assured it that the required licenses would be issued. The Commerce Department began issuing permits on August 8, 2025.

Trump later said the exports would carry a payment to the U.S. government equal to 15% of H20 revenue from China. He said he initially sought 20%, but Huang negotiated the rate down. In December 2025, U.S. authorities also allowed exports of the more powerful H200 processor to vetted Chinese customers, with a payment equal to 25% of revenue.

NVIDIA opposes some legislative proposals that could restrict its international sales. The company says it complies with U.S. export laws and that additional controls could reduce the competitiveness of the U.S. technology sector.

Source: Incrypted