Nvidia violated antitrust law, China says

SINGAPORE—China said an initial probe found Nvidia violated the country’s antimonopoly law, heightening pressure on Washington during the latest round of U.S.-China trade talks that ended Monday.

Beijing’s antitrust regulator cited the violations in connection with Nvidia’s acquisition of an Israeli company that was completed in 2020. The regulator said the investigation was continuing, and it didn’t elaborate on the preliminary findings or say whether it would punish Nvidia.

Beijing approved the deal after Nvidia agreed to conditions including guaranteeing the supply of its chips to China. Since 2022, the U.S. government has blocked Nvidia and other American chip vendors from selling many of their top-flight artificial-intelligence chips to China.

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Jensen Huang, co-founder and chief executive officer of Nvidia Corp., holds up the company’s AI accelerator chips for data centers. (Akio Kon/Bloomberg via / Getty Images)

Beijing’s move came just hours before Treasury Secretary Scott Bessent told reporters in Madrid that U.S. and Chinese negotiators had reached a framework deal on TikTok following two days of trade talks. The two sides were running up against a Wednesday deadline to make a deal to allow the popular video-sharing app to continue operating in the U.S.

Nvidia’s shares fell around 1% in morning trading. The company didn’t immediately respond to a request for comment.

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Nvidia has become perhaps the highest-profile business caught in the crossfire of the trade dispute between the world’s two biggest economies. The company sells the world’s most powerful chips, which are essential for building state-of-the-art AI.

The Nvidia headquarters in Santa Clara, California. (Loren Elliott/Bloomberg via / Getty Images)

In December, China’s antitrust regulator, the State Administration for Market Regulation, opened a probe into Nvidia’s $7 billion acquisition of the Israeli networking-gear maker, Mellanox Technologies. A week earlier, the Biden administration ratcheted up controls on China’s access to high-end chips.

Antitrust lawyers familiar with the case said Nvidia was in a tough spot because it had to halt supply of its most advanced chips to China to comply with U.S. export controls, but that opened it up to criticism from Beijing. Chinese regulators argued that Nvidia was violating its pledge back in 2020 to provide an uninterrupted supply of chips to China and to treat Chinese customers equally, the lawyers said.

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