Cotton Demands CXMT Entity Listing as Senators Corner Lutnick

Senator Tom Cotton has asked Commerce Secretary Howard Lutnick to place ChangXin Memory Technologies, the world's fourth-largest DRAM maker, on the Entity List — a move that would cut the Chinese company off from most U.S. suppliers and technology. The letter, sent Thursday, Nov. 12 and first obtained by CNBC, marks the sharpest congressional escalation yet against a memory maker whose DRAM revenue share jumped from 4% to 10% between the second quarters of 2025 and 2026, according to Counterpoint.

Cotton's language was blunt. "CXMT, one of Communist China's national memory chip champions, poses a growing risk to our economic prosperity and military superiority," he wrote. "The U.S. must take action to prevent CXMT from gaining a stronger foothold in the global market."

Why does CXMT worry Washington now?

The numbers explain the timing. CXMT's share of DRAM revenue more than doubled in a year, according to Counterpoint, eating into a market dominated by Samsung, SK hynix and Micron. CXMT went public in July and became the most valuable company listed in China at the time.

The greater concern is high-bandwidth memory. Samsung, SK hynix and Micron make almost all of the world's HBM, which feeds AI accelerators from Nvidia, Google and Amazon Web Services. Counterpoint calls CXMT's HBM capabilities nascent. Reuters has reported CXMT was set to start HBM production anyway, even though yields run at only 20% to 30%. Cotton read those yields as evidence of weakness rather than strength. CXMT's "decision to move forward in less than ideal conditions highlights both Communist China's desperation for chips and manufacturing struggles without advanced equipment and knowledge," he wrote.

The enforcement gap is real. CXMT already sits on the Pentagon's 1260H list of companies tied to China's military, but that designation carries few restrictions for U.S. businesses, said Kyle Chan, a Brookings Institution fellow. An Entity List designation would go much further. "U.S. companies are not allowed to do business with that entity-listed company, and that entity-listed company does not get access to U.S. technology," Chan told CNBC.

The listing could also squeeze buyers. The Wall Street Journal reported in August that Apple was considering CXMT memory for iPhones and Macs amid the AI-driven memory shortage. One caveat: no listing has occurred, and Commerce has not publicly responded to Cotton's letter.

What do the Democrats want from Lutnick?

A day before Cotton's letter, on Wednesday, Nov. 11, Democratic Sens. Elizabeth Warren of Massachusetts and Chris Coons of Delaware asked the administration to preserve every record on Nvidia's chip exports to China. Their letter went to Lutnick, Secretary of State Marco Rubio and White House chief of staff Stephen Miller, Reuters reported.

The request covers records "regarding the export of NVIDIA's advanced AI chips to China or to entities that may divert such chips to China." It also seeks communications about Nvidia CEO Jensen Huang and the woman U.S. officials reportedly suspect of working for Chinese intelligence, according to The Wall Street Journal, which first reported the letter. The senators want written confirmation of the document hold by Tuesday, Nov. 17, plus a congressional briefing on national-security risks.

"This incident raises significant concerns about the federal government's ability to effectively enforce our export controls," the senators wrote. They also questioned "whether or not prudent defensive counter-intelligence action was taken." Coons is set to chair the Senate Foreign Relations Committee and Warren the Senate Banking Committee in the new Congress, which gives both letters institutional weight.

Why are Republicans attacking Lutnick?

The Republican criticism centers on Megaspeed, the Singapore-based Nvidia customer accused of diverting chips to China, which Commerce has not blacklisted. Treasury Secretary Scott Bessent confronted Lutnick about that decision last week, the New York Times and Axios reported.

"Secretary Lutnick needs to answer that in front of God and country," Sen. John Kennedy of Louisiana told Politico on Wednesday. He asked "why did he choose to sell advanced chips?" and urged Lutnick to hold a press conference. Rep. Bill Huizenga of Michigan said Lutnick has not "been very responsive," called on him to testify, and said the Bureau of Industry and Security has been "less responsive than they should be" to briefing requests.

Rep. John Moolenaar of Michigan, outgoing chair of the House China select committee, wants Commerce officials to brief lawmakers. House Foreign Affairs Chair Brian Mast of Florida has introduced the AI Overwatch Act, which would let Congress review sales of advanced AI chips to China and other adversaries.

"BIS has a strong relationship with Members of Congress from both parties on our committees of jurisdiction," BIS spokesperson Thomas Wackman told Politico. BIS is negotiating with Congress over three chip-restriction proposals, including some in the annual defense authorization bill, Politico reported, citing two people familiar with the talks.

Commerce now faces pressure from both parties at once: blacklist CXMT, explain Megaspeed, and preserve the Nvidia paper trail. Whether Lutnick answers any of the three demands before the Nov. 17 deadline will shape the next round of export-control fights.