Blacklisted Chinese Defense University Procured Advanced NVIDIA AI Chips Despite U.S. Export Controls: Report

A Chinese university with extensive ties to the People’s Liberation Army has acquired advanced NVIDIA Corp.  artificial intelligence (AI) processors despite being on a U.S. trade blacklist, according to public procurement records.

The revelations, reported by Reuters, underscore persistent enforcement gaps in Washington’s campaign to choke off Beijing’s access to cutting-edge Western computing power.

Northwestern Polytechnical University, a Xi’an-based institution blacklisted by the U.S. Commerce Department in 2001 for military and missile-proliferation research, purchased two cutting-edge NVIDIA H200 chips in October for 874,700 yuan ($123,000). The transaction was executed through an intermediary, domestic vendor Shaanxi Bosuan Network Technology, rather than directly with the California-based semiconductor giant.

The acquisition is part of a broader, systemic bypass. A review of dozens of recent Chinese public filings revealed widespread circumvention of export curbs by defense-linked academies, which have secured restricted hardware either through third-party domestic resellers or by leasing computing capacity hosted on remote servers, according to the Reuters investigation.

Northwestern Polytechnical alone awarded multiple contracts this year granting its researchers access to high-performance clusters powered by restricted NVIDIA A100, A800, and H200 processors.

The leased infrastructure was earmarked for sensitive computational work, including AI model fine-tuning and structural and fluid-dynamics simulations. Similar procurement patterns surfaced at other institutions, including Beihang University, another member of China’s “Seven Sons of National Defense” state defense research network.

Neither NVIDIA, Northwestern Polytechnical, nor the U.S. Commerce Department’s Bureau of Industry and Security immediately responded to requests for comment.

The revelations come at a precarious political moment for NVIDIA and its CEO, Jensen Huang. Lawmakers on Capitol Hill have intensified scrutiny of the chipmaker’s lobbying efforts to relax export controls, arguing that top-tier microprocessors accelerate Chinese military modernization and weapons design. On Wednesday, Sen. Kevin Cramer, R-N.D., a member of the Senate Banking Committee, called on Huang to resign. [Axios reported that the Commerce Department received a national security warning on Jensen Huang’s affair with an alleged Chinese spy.]

As Washington weighs mandatory on-chip tracking mechanisms and expanded export oversight, the illicit flow of silicon through domestic intermediaries highlights the formidable hurdles facing unilateral technology sanctions in a sprawling global supply chain.

Compounding pressure, three Republican congressional committee leaders recently requested a formal briefing with Huang regarding reports of an alleged Chinese espionage operation directed at him. While NVIDIA affirmed that it has no evidence of compromised national security or proprietary trade secrets, Huang is reportedly cooperating with an FBI inquiry.

The converging controversies have unsettled Wall Street, sending NVIDIA’s stock tumbling and fueling rare investor discourse concerning governance risks and long-term executive succession.

Huang, 63, maintains an unusually centralized grip on corporate operations through a flat leadership structure, without a publicly designated heir apparent. Should an abrupt leadership transition occur, market attention would likely turn to a handful of veteran deputies.

Chief Financial Officer Colette Kress, who has anchored NVIDIA’s investor relations and fiscal strategy since 2013, stands out as a steady institutional presence, though her background lies strictly in finance rather than semiconductor architecture.

Other potential internal figures include Ian Buck, a pioneer of the proprietary CUDA software platform driving NVIDIA’s AI dominance, as well as operations chief Debora Shoquist, general counsel Tim Teter, and recently recruited commercial veteran Nick Parker.

NVIDIA’s corporate board has not disclosed any contingency succession mechanisms, and while Huang holds roughly 3.6% of the company’s equity, he retains no super-voting shares that would grant him unilateral board control.

“A succession plan written in the middle of a crisis is a reaction, not a plan. The time to build the bench and agree on the rules is while the founder is still firmly in charge,” said Alejandro Cardenas Villa, author of “Legacy Traps: Why Family Businesses Fail and How to Protect Yours.”