China Calls US a 'Surveillance Empire' on Chip-Shipment Tracking
By Reuters | 15 Aug, 2025

Beijing exploits US chip-tracking policy to cast aspersions on security of Nvidia H20 AI GPUs.

The United States' practice of installing location trackers in chip shipments at risk of diversion to China reflects the "instincts of a surveillance empire," China's state-run media outlet Xinhua said in a commentary published on Friday.

Reuters reported earlier this week that U.S. authorities had secretly placed location tracking devices in targeted shipments of advanced chips to detect diversions to China, which is under U.S. curbs for advanced chip exports.

The Xinhua commentary, titled "America turns chip trade into a surveillance game," cited "reports" that Washington had embedded such trackers, accusing the United States of running "the world's most sprawling intelligence apparatus".

The U.S. government has in the past few years tightened restrictions on the exports of advanced chips as well as related technology and equipments to China, as the two superpowers vie for technological dominance.

The Chinese commentary follows longstanding accusations from Washington and its Western allies that China could use some exported products, from telecommunications equipment to vehicles, for surveillance, posing potential security risks.

In 2022, the Biden administration banned the sale and import of new telecommunications equipment from several Chinese firms, including Huawei, citing national security concerns. In January, it intensified scrutiny by targeting China-made cars and trucks.

In its commentary, Xinhua accused the U.S. government of seeing its trading partners as "rivals to be tripped up or taken down," adding that "if U.S. chips are seen as Trojan horses for surveillance, customers will look elsewhere."

China's cyberspace watchdog last month said it had asked U.S. chipmaker Nvidia to explain whether its H20 chips had any backdoor security risks - a hidden method of bypassing normal authentication or security controls.

Chinese authorities have also cautioned domestic tech firms over their use of H20 chips, Reuters recently reported.

(Reporting by Yukun Zhang and Ryan Woo; editing by Clelia Oziel)