Chinese authorities launched an antitrust investigation on Monday against Nvidia, one of the world’s biggest chip manufacturers. According to the authorities, Nvidia has breached the country’s anti-monopoly law. The company’s share value slid by 2.2% after the news broke.
However, experts claim that the investigation is retaliation against Washington’s latest actions against the Chinese chip manufacturing sector. Further, the State Administration for Market Regulation (SAMR) didn’t mention how the company breached the country’s anti-monopoly framework.
Genesis Of the Action
The news broke out after the US government executed its third crackdown on the Chinese semiconductor industry in the last three months. Also, the authorities in the United States further curtailed the exports to 140 companies, including chip equipment manufacturers.
This provoked China to take a strict stance against the nation, and apart from taking regulatory actions against the US-based companies, Beijing banned the exports of the critical minerals gallium, germanium and antimony to the US.
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The Nvidia Angle
Nvidia is one of the largest chip makers in the world, and it is known for its AI and gaming chips. The company dominated the Chinese market before the US government made strict regulatory guidelines against exports to China.
Nvidia is among the numerous companies impacted by US-China tensions. Earlier, US export restrictions barred Nvidia from selling its cutting-edge AI chips to China, leading the company to develop new, China-specific versions that comply with US export regulations. That is not all.
The company has also faced regulator’s protocol in China. Beijing’s approval imposed several conditions on Nvidia and the merged entity’s operations in China, including bans on forced product bundling, unfair trading terms, purchase restrictions, and discriminatory treatment of customers who buy products individually.
