Malaysia to tighten controls over Nvidia chip flow on US pressure

Washington asked Malaysia to closely scrutinize the shipment of Nvidia chips coming to the country, Investment, Trade and Industry Minister Zafrul Abdul Aziz said

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By Gao Yuan and Mackenzie Hawkins

 

Malaysia plans tighter controls over the flow of Nvidia Corp.’s chips after the US demanded it keep a closer eye on advanced semiconductors that could potentially make their way to China, the Financial Times cited the trade minister as saying. 

Washington asked Malaysia to closely scrutinize the shipment of Nvidia chips coming to the country, Investment, Trade and Industry Minister Zafrul Abdul Aziz told the newspaper. “They want us to make sure that servers end up in the data centers that they’re supposed to and not suddenly move to another ship.”

 

A spokesman at the ministry declined to comment on the report. Nvidia representatives didn’t immediately respond to a request for comment.

 

The minister’s pledge coincides with a Singapore investigation into the final destinations of a bunch of servers likely containing Nvidia chips, after they were allegedly shipped from the city-state to Malaysia. Investigators have charged three men with fraud for allegedly misleading server suppliers Dell Technologies Inc. and Super Micro Computer Inc. about the final end users of the hardware, which Singaporean authorities said may have contained Nvidia chips that are banned from sale in China. 

 

For their part, Malaysian authorities said earlier this month they had yet to find any evidence of fraud involving Nvidia AI chips being shipped from Singapore, but that they will continue to work with the US and Singapore to address any concerns related to trade of advanced technology.

 

If the servers did indeed contain advanced Nvidia chips, and also wound up in China, that could amount to a violation of US trade rules. Washington has for years curbed Chinese imports of advanced semiconductors and the tools used to make them, over concerns that the technology — particularly its artificial intelligence applications — could fuel Beijing’s military capabilities. They’ve also expanded some restrictions to countries from Southeast Asia to the Middle East, which US officials worry could serve as back doors for China to access banned tech. 

 

Singapore has recently found itself a focal point of those efforts. Trump administration officials are looking into whether Chinese AI startup DeepSeek managed to purchase banned Nvidia chips via third parties in Singapore, Bloomberg has reported. US lawmakers have raised concerns about the large share of Nvidia revenue that comes from Singapore despite relatively small physical shipments to the country, which they say points to possible transshipment of hardware to China. Singapore and Nvidia officials have said that many Nvidia customers use the island as a centralized billing location, and that the island only receives a small number of physical Nvidia deliveries.