China has granted its leading AI startup DeepSeek permission to purchase Nvidia's H200 artificial intelligence chips, subject to regulatory terms that are yet to be finalized, according to reports.
Reports cite that ByteDance, Alibaba and Tencent were given permission to purchase more than 400,000 H200 chips in total, according to the report.
Nvidia CEO Jensen Huang believes that China was still finalizing the license.
China's industry and commerce ministries have granted approvals for all four companies, but have stipulated that they will impose conditions that are still being finalized, reports claim. These conditions are being decided by China's state planner, the National Development and Reform Commission (NDRC), according to one of the people.
China's Ministry of Industry and Information Technology, Ministry of Commerce and NDRC did not answer requests for comment.
DeepSeek, which rattled the global tech sector early last year by rolling out AI models that cost a fraction of those being developed by U.S. rivals such as OpenAI, did not answer a request for comment.
The H200, Nvidia's second most powerful AI chip, has emerged as a major flashpoint in U.S China relations Despite strong demand from Chinese firms and U.S. approval for exports, Beijing's hesitation to allow imports has been the main barrier to shipments.
The US earlier this month formally cleared the way for Nvidia to sell the H200 to China, where the company is seeing strong appetite. However, Chinese authorities have the final say on whether they would allow it to be shipped in.
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Any purchases of H200 chips by DeepSeek could draw scrutiny by US lawmakers.
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DeepSeek is expected to launch its next-generation AI model V4, featuring strong coding capabilities, in mid-February, according to reports.