China Accuses Nvidia of Antimonopoly Violations

Lead Beijing’s market regulator announced Monday that U.S. chipmaker Nvidia failed to meet conditions tied to its $6.9 billion Mellanox acquisition, signaling heightened scrutiny amid U.S.-China trade talks.

Nut Graf The preliminary finding by China’s State Administration for Market Regulation underscores growing tensions over technology and trade as U.S. and Chinese officials convene in Madrid this week. The probe could further complicate negotiations on tariffs, export controls and national security measures.

Key Developments

Preliminary Ruling
China found Nvidia noncompliant with antimonopoly conditions set in 2020 for its purchase of Israel’s Mellanox Technologies.
No penalties announced yet; regulator vows “further investigation.”
Trade-War Context
The ruling coincides with the fourth round of U.S.-China trade talks, led by Treasury Secretary Janet Yellen and Vice Premier He Lifeng in Spain.
It follows a Chinese antidumping probe into U.S. analog IC imports and an antidiscrimination review of U.S. chip restrictions.
Possible Impacts
Escalation could trigger reciprocal measures on semiconductors, a flashpoint in Beijing-Washington tensions.
Nvidia faces export controls from both Biden and Trump administrations, potentially limiting sales to Chinese customers.

Background

China conditionally approved the Mellanox deal in December 2019, marking a rare green light for such a large tech acquisition. The subsequent investigation revisits terms designed to preserve market competition in data-center networking equipment.

What’s Next

Regulators will determine whether to impose fines, operational limits or other sanctions. Both governments aim to balance economic interests with strategic concerns over critical technologies.

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