Bessent criticizes delay in restricting Nvidia chip exports to China amid Megaspeed dispute
Key Facts
U.S. Treasury Secretary Scott Bessent said on November 13 that he was frustrated by the Commerce Department’s delay in imposing restrictions on exports of some Nvidia chips to China. His remarks have brought Megaspeed back into the debate over access to advanced chips in the Chinese market, after four U.S. government agencies backed placing the company on an export control list months ago, according to Bessent. The agencies include the Treasury Department, the State and Defense departments, and the Office of the U.S. Trade Representative. Bessent said the Commerce Department was responsible for the action in this case, adding: "Commerce holds the pen, and you should ask it about its internal procedures." The department did not immediately respond to requests for comment, while Bessent declined to comment on a report of an earlier confrontation with Commerce Secretary Howard Lutnick, according to the Associated Press.
The dispute puts decision-making authority at the center of the case, but Entity List rules assign additions and amendments to the End-User Review Committee, which is chaired by the Commerce Department and includes representatives from the State, Defense, Energy and Treasury departments as appropriate. A Bureau of Industry and Security document says the committee decides whether to add entities to, remove them from or amend the list. The list identifies entities for which there is reasonable cause to believe, based on specific facts, that they have engaged or are likely to engage in activities contrary to U.S. national security or foreign policy interests. Bessent is therefore directing responsibility for execution to Commerce, while the regulatory framework specifies that list decisions go through a joint committee chaired by the department. The dispute comes as political scrutiny of Nvidia chip exports to China intensifies.
Chinese companies have obtained Nvidia chips through companies including Megaspeed, which bought more than $4 billion worth of advanced semiconductors from Nvidia through November 13, 2026, the Associated Press said. Megaspeed highlights its partnership with Nvidia on its website, according to the news agency, while ties between the two companies have become part of the fallout surrounding Nvidia Chief Executive Jensen Huang’s resignation. The debate over restrictions is rooted in U.S. concerns that advanced artificial intelligence technologies could reach China. Bessent said President Donald Trump had made clear that China should not receive Nvidia’s latest chips, newer than the H100, adding that the H100 is an older generation of the company’s advanced chips. That position sets a publicly stated political limit on what can reach China, amid debate over how restrictions on intermediary companies should be enforced.
The case is also expanding through investigations and congressional oversight requests. The Justice Department’s National Security Division is investigating whether Megaspeed violated export control laws, and the inquiry includes scrutiny of Alice Huang, the Associated Press said. The Commerce Department’s Bureau of Industry and Security initially led the investigation, according to a letter to Senator Michael Bennet, while press reports cited in the letter indicated that the Justice Department is now leading it. Bennet asked U.S. officials for an update on the investigation and on Commerce’s efforts to prevent Megaspeed from buying Nvidia chips. He set November 24, 2026, as the deadline for a response to his request, including information on the Justice Department taking over the Commerce investigation.
On November 11, Senators Elizabeth Warren and Chris Coons asked the administration to preserve records and materials related to Nvidia exports to China and national security risks. They also requested written confirmation by November 17 that preservation instructions had been issued, along with a briefing for members of Congress on the security risks. Pressure on the Commerce Department dates back to March 2026, when Senators Jim Banks and Warren urged the department to suspend or reconsider licenses for Nvidia chip exports after criminal allegations related to the diversion of servers to China. These requests add an oversight track parallel to the criminal investigation, as senators seek documentation of communications and decisions concerning exports. This comes as the Commerce Department has not immediately responded to requests for comment on Bessent’s criticism.
Lutnick agreed to testify before the Senate Banking Committee on December 10, 2026, according to a U.S. official cited by CBS News. The testimony is expected to give the committee an opportunity to question the commerce secretary about his department’s actions in the Megaspeed case, as Bessent publicly raises the issue of the delay in imposing restrictions. In the market, Nvidia closed at $166.19 per share on November 12, compared with a close of $173.73 on November 11, according to EL7 data. The two closing prices provide context for the stock’s movement in the sessions before Bessent’s remarks, without establishing the reason for the price change. The next steps remain tied to the administration’s response to Bennet’s request by November 24, followed by Lutnick’s scheduled testimony in December.