TAIPEI (Taiwan News) — China is investigating Nvidia in an antitrust probe, as the US chip company gets further intertwined in US-China friction.
In a news brief on Monday, China said Nvidia is suspected of violating the country’s anti-monopoly laws, but it did not provide further details. Regulators appear to be focusing on Nvidia’s US$6.9 billion acquisition of Israeli chip designer Mellanox Technologies in 2019.
Some analysts see the investigation as retaliation against Washington’s latest crackdown on China's semiconductor industry, per Reuters. This month, the US curbed exports to 140 companies to stymie Beijing’s ability to access and produce chips.
According to Commerce Secretary Gina Raimondo, the measure aims to stop “China from advancing its domestic semiconductor manufacturing system, which it will use to support its military modernization.”
Before China’s investigation, Nvidia was already facing an antitrust probe by the US Justice Department. The Information reported this summer that the DOJ is looking into complaints by rival companies that Nvidia was abusing its market dominance by blocking customers from doing business with competitors.
An Nvidia spokesperson said the company is “happy to answer any questions regulators may have about our business.”
Nvidia shares fell 2.6% on Monday after China announced its recent probe. Due to AI demand, they are still up 180% this year.
Nvidia is one of many companies entangled in US-China tensions. The company had to continuously develop modified chips for the Chinese market after US sanctions in 2022 banned A100 and H100 AI chip shipments, which were later tightened in October 2023.
According to TECHnalysis Research chief analyst Bob O'Donnell, "It's clear that the Chinese government is trying to react against recent restrictions from the US, but their ability to impact the US semiconductor industry continues to decrease over time.” He said the probe is unlikely to greatly impact Nvidia since most of its advanced chips are already restricted from entering China.
The last time Beijing launched an antitrust probe into a foreign tech firm targeted Qualcomm in 2013. The US company was accused of overcharging and abusing its market position in wireless communication, and later agreed to pay a US$975 million fine.
