Beijing (Brussels Morning Newspaper) – China’s market regulator stated on Monday that a preliminary investigation revealed US chip giant Nvidia had breached the country’s antitrust rules, and pledged an additional investigation.
China is currently engaged in an intense contest with the United States for supremacy in the critical field of semiconductors.
Why has China accused Nvidia of breaching antitrust laws?
“Following a preliminary investigation, it has been determined that NVIDIA Corporation has violated the Anti-Monopoly Law of the People’s Republic of China,”
A statement from the State
Administration for Market Regulation, Beijing’s top market watchdog, said.
Although the State Administration for Market Regulation’s brief statement didn’t elaborate on how the company, famous for its artificial intelligence and gaming chips, may have breached China’s anti-monopoly laws, it did state that an investigation is underway.
China’s regulator claimed the U.S. chipmaker had also breached the commitments it made when it acquired Israeli chip designer Mellanox Technologies, as stipulated in the 2020 conditional approval of that deal. The SAMR on Monday added that it would continue its investigations.
What penalties could Nvidia face under Chinese law?
According to China’s antitrust law, companies can face fines of between 1% and 10% of their annual sales from the previous year. China generated $17 billion in revenue for Nvidia in the fiscal year ending January 26, or 13% of total sales, based on its latest annual report.
When did China launch the investigation?
China launched an investigation into Nvidia in December, citing suspected breaches of the country’s anti-monopoly law. The move was widely viewed as a retaliatory measure in response to the US’s restrictions on China’s chip sector.
Following the US’s third crackdown in three years on China’s semiconductor industry, the investigation came about after Washington restricted exports to 140 companies, including those that manufacture chip equipment. Following Washington’s announcement, Beijing imposed a ban on exporting the critical minerals gallium, germanium and antimony to the US.
