Nvidia Found Guilty of Antitrust Violations in China
▼ Summary
– A Chinese regulator has preliminarily found Nvidia violated antitrust law by not fully complying with conditions from its 2020 Mellanox acquisition.
– The State Administration for Market Regulation (SAMR) announced this finding as US-China trade talks were set to resume, with a tariff truce expiring soon.
– SAMR timed the announcement to give China greater leverage in these upcoming trade negotiations, according to sources familiar with the matter.
– The investigation began in December, shortly after the US imposed stricter export controls on advanced chips and chipmaking equipment to China.
– Potential consequences for Nvidia include fines of 1-10% of its previous year’s sales and mandated changes to its business practices.
A Chinese regulatory body has issued a preliminary ruling that Nvidia violated antitrust laws by failing to meet conditions tied to its 2020 acquisition of Mellanox Technologies. The State Administration for Market Regulation (SAMR) announced the findings on Monday, stating that the chipmaker did not fully adhere to obligations set when it purchased the Israeli-American networking supplier.
The announcement coincided with preparations for renewed trade discussions between US and Chinese officials in Madrid, with a tariff pause between the two economic superpowers scheduled to end in November. According to sources familiar with the situation, SAMR reached its decision weeks earlier but timed the disclosure to strengthen China’s position in upcoming negotiations.
SAMR launched its antitrust probe last December, just one week after the United States imposed stricter export controls on advanced high-bandwidth memory chips and semiconductor manufacturing equipment bound for China. Over several months, the regulator conducted interviews and compiled legal assessments to substantiate the case against Nvidia.
The $6.9 billion Mellanox acquisition significantly boosted Nvidia’s presence in the data center and high-performance computing sectors, where it now holds a leading market position. Should the preliminary findings be upheld, the company could face financial penalties ranging from 1% to 10% of its prior year’s revenue. Regulators may also require Nvidia to modify business practices deemed anti-competitive.
(Source: Ars Technica)
