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U.S. chipmaking giant Nvidia is ordering its data center partners to scale back work with Chinese customers, the Financial Times reported on Tuesday.
Nvidia's cloud computing clients must now sell at least 51% of their services to non-Chinese companies, the FT reported, citing five people with knowledge of the matter.
The new rules only affect future contracts and not existing agreements, the report said.
Nvidia neither confirmed nor denied the report to Agence France-Presse (AFP), but said in a statement that "datacenters and clouds built on American chips are the foundation that American model and application makers need to compete worldwide."
"Longstanding U.S. policy encourages every cloud to build on American infrastructure and to win business everywhere they can," the statement said.
"America cannot win the AI race unless America's AI infrastructure wins worldwide, if the world's clouds rely on foreign-made chips, the model and application layers will be foreign-built as well,” the statement added.
Asked about the report, Chinese foreign ministry spokesperson Mao Ning said she was not aware of it.
"As a matter of principle, we consistently hope that all parties can provide a fair, transparent and non-discriminatory business environment for companies from all countries, including Chinese companies," she said.
China and the United States are locked in a race for dominance in the fast-moving artificial intelligence sector.
In recent months, the two countries have traded accusations of stealing AI technologies and jeopardizing security.
Nvidia is one of the world’s most valuable companies thanks to the global drive to build data centers packed with specialist computer chips and other hardware that runs AI systems.
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