The U.S. Commerce Department has approved Chinese companies to buy or handle Nvidia's H200 AI chip, and some of them cannot be verified as real operating businesses, The New York Times (NYT) reported on November 7, 2026. One of them is Beijing-based New Matrix. The building at the address the reporter visited had no tenant record for the company, and its owner is reportedly linked to an affiliate of Wise Road, an investment fund subject to U.S. export controls. Wise Road was added to the U.S. government's export control list, the Entity List, in 2024. What matters most here is less the sales volume of H200 chips to China than how well the existence of approved companies has been verified. Nvidia's H200 shipments to China made up less than 1% of its data center revenue in the most recent quarter, yet a company founded roughly six months before the sales approval was announced is already on the approved list.
A company with no tenant record on the H200 approval list
New Matrix was approved by the Commerce Department as a company that incorporates H200 chips into AI servers. But when the NYT reporter visited its registered address, the company's name did not appear in the building's tenant directory. At the management office of a nearby industrial park, both the receptionist and the manager said they had no record of New Matrix. The NYT described the interior of the building as a bare gray space with wiring hanging from the ceiling. The company was only 17 months old, and little information about its business activities could be found online.
The NYT also reported that Chinese corporate registration records show New Matrix's owner is connected to companies linked to Wise Road. Wise Road is an investment fund that was added to the Commerce Department's Entity List in 2024 for helping China acquire sensitive semiconductor companies. However, a connection through affiliates to a restricted fund does not mean New Matrix itself violated export controls. The problem is that, from public information, it is impossible to tell how such relationships were weighed in the export license review.
Another company the NYT examined, Maginfraʼs office, was also reportedly empty when visited in September 2026. Analysts have pointed to links between that company and Inspur, a Chinese server maker on the U.S. Entity List. The Commerce Department has approved about 24 Chinese companies to buy or handle the H200, and the list includes Baidu, BYD and Tesla Shanghai. In response to the report, a spokesperson for the Commerce Department's Bureau of Industry and Security (BIS) said every application is carefully reviewed for national security risks.
Nvidia spokesperson John Rizzo said it would not be reasonable for China's military to depend on American technology. Liza Tobin, a former China director at the National Security Council (NSC), expressed strong concern that both the Commerce Department and Nvidia may not have carried out the necessary due diligence. It has not been proven that New Matrix or Maginfra are shell companies. But the situation revealed by the report highlights the need to examine whether the review of approved companies' business activity and affiliations was adequate.
Founded about six months before the H200 sales approval; under 1% of China-related sales
To understand the issue, it helps to review how the U.S. government came to allow H200 exports to China. In December 2025, President Donald Trump announced that H200 sales to U.S.-approved Chinese customers would be allowed, with a framework under which the government would receive revenue equal to 25% of sales. In practice, however, the mechanism is not a direct tax on sales: a 25% tariff is applied to chips brought into the U.S. for third-party testing. Nvidia has said it has not been able to pass this tariff burden on to customers.
Under a BIS rule that took effect in January 2026, the review policy for exports of H200-class chips to China changed from a presumption of denial to case-by-case review. To obtain a license, applicants must describe their customer vetting procedures, have the products tested by an independent third party in the U.S., and show that the products are not destined for China's military or military intelligence. These conditions are intended to control destinations and end uses. But the report does not make clear how applicants' existence and business substance are specifically verified.
New Matrix's founding date raises further questions. According to the NYT, the company was only about 17 months old at the time of the report; counting back from November 7, 2026, it was likely established around June 2025, with a margin of about a month. That is roughly six months before President Trump announced the H200 sales approval in December 2025. Wise Road, whose affiliates are said to be linked to New Matrix's owner, had already been added to the Entity List in 2024.
In other words, a company connected to affiliates of an investment fund subject to U.S. export controls was founded about six months before the H200 sales approval was announced, and was later added to the list of companies approved to handle the chips. However, there is no evidence of a causal link between the company's founding date and the export approval, and it cannot be concluded that the company was set up in anticipation of the new export regime. Nor does an ownership link to an affiliate constitute an export control violation. What matters is how the Commerce Department verified the company's operations and ownership and reflected that in its licensing decision.
In terms of actual export volume, H200 sales to China remain limited. According to Nvidia's disclosures, H200 shipments to China in the quarter ended July 2026 were less than 1% of its Data Center revenue. Reuters also reported on November 5, citing two sources, that about 600,000 H200 chips remain in Hong Kong because the Chinese government has not approved large-scale imports. Given this, the launch of the export license system should be distinguished from large volumes of H200 chips actually flowing into the Chinese market.
Still, low export volume today does not prove the review system is sound. The approved list is the gateway that determines which companies can buy or handle the H200. If verification of companies' existence and business substance is inadequate, inappropriate distribution channels could expand as shipments grow in the future. Third-party testing in the U.S. and end-use certification are important control measures, but they alone cannot guarantee that a counterparty actually exists. What the report raises is not how many H200 chips have been sold, but whether the U.S. government sufficiently knows who it is allowing to receive them.
No actual harm confirmed: what future scrutiny must address
The report alone cannot establish that the export control system is flawed. What the NYT revealed was that it could not confirm New Matrix's presence at the address the reporter visited, among other things; it presented no evidence that the company actually received H200 chips or diverted products to Chinese military bodies. BIS says it carefully reviews all applications, but what information it checked during that process is unknown. And if China's government has not been approving imports, shipments even to licensed companies may have been limited. An empty office at the time of a visit does not by itself mean there is no business activity.
These counterarguments matter when assessing the harm that can currently be confirmed. But the issue is not only whether improper exports actually took place; it is also whether the mechanism for verifying the existence of approved companies is working properly. If a company exists and conducts legitimate business, registration records, evidence of business operations and review records should exist to support that. With the verification process not open to scrutiny from public information, it is difficult to reach a conclusion about the system's effectiveness.
Resolving the concern requires two main confirmations. One is for the Commerce Department to explain its review of New Matrix and Maginfra and clarify how it confirmed the two companies' existence and business substance. The other is for materials supporting the companies' actual operations, such as office activity and concrete business dealings, not just registration records, to be verified by third parties. If these show that both companies exist and conduct legitimate business, concerns about their existence would at least begin to ease. But that alone would not prove the soundness of the export review as a whole, or the end use of the products.
Political developments also bear watching. Three chairs of U.S. House committees have asked Nvidia CEO Jensen Huang for a closed-door briefing on November 18, with a response deadline of November 11. The request concerns Nvidia's relationships with customer companies and safeguards against foreign intelligence activity, and the question is how concretely the company will explain its customer controls and product distribution channels. However, information covered in a closed-door briefing is not necessarily made public, and it is not yet known whether details of the reviews of New Matrix or Maginfra will emerge.
The issue is not irrelevant to Japanese semiconductor and chipmaking equipment makers. In export controls, it matters not only what a product's performance and end use are, but also whether the counterparty exists and is conducting the business it has declared. Companies are therefore expected to conduct proper due diligence on their trading partners and keep records so they can explain the review process when necessary. If the Commerce Department can sufficiently explain how it verifies approved companies' existence and how it conducts reviews, that would provide grounds for maintaining confidence in the licensing system even if H200 export volumes grow. Conversely, if the verification process remains unclear, the strictness of the rules alone cannot be taken as proof that control of export destinations is being handled appropriately.