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China launched an investigation against Nvidia in response to the US export sanctions

Author:
Oleksandra Opanasenko
Date:

The Chinese regulator has launched an investigation against American chip maker Nvidia. The company is accused of violating antimonopoly legislation and failing to fulfill its obligations.

Reuters writes about it.

The statement by the State Administration of Market Regulation (SAMR) did not specify how the American company could have violated Chinaʼs antitrust laws. However, the regulator indicated that Nvidia is being reviewed for compliance with the terms of its $6.9 billion acquisition of Mellanox in 2020. At the time, it was a record deal in Nvidiaʼs history.

The investigation comes after the US imposed sanctions on Chinaʼs semiconductor industry last week. In particular, the US restricted exports to 140 companies, including manufacturers of chip equipment. So Reuters notes that Chinaʼs investigation is a response to the US sanctions.

Nvidia has become one of many companies involved in the US-China "technology wars". This previously prevented Nvidia from selling its advanced AI chips to China. So the company developed new versions of the chips specifically designed for China that complied with US export controls.

Shares of Nvidia began to fall amid reports of an antitrust investigation in China.

The last time China conducted an antitrust investigation against a major foreign technology company was in 2013. Then Qualcomm came under investigation for abusing its position in the wireless market. The company paid a $975 million fine — at the time, the largest amount ever paid to China by a foreign company.

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