TAIPEI, Taiwan – China has opened an antitrust investigation into American chipmaker Nvidia, the world’s largest provider of processors that power artificial intelligence, weeks after the U.S. announced a semiconductor export control package against China.
The U.S. package, curbing exports to 140 companies, was part of its latest major effort to block China’s access to and production of chips capable of advancing artificial intelligence for military purposes. China retaliated, tightening controls on the export of key raw materials to the U.S. and cautioning Chinese companies against buying American chips.
The Chinese government believed Nvidia’s purchase of Israeli networking company Mellanox could violate its anti-monopoly laws, said China’s State Administration for Market Regulation in a statement on Monday, without specifying details. China approved the regulation in 2020.
Nvidia had not responded to China’s announcement of its investigation at the time of publication, but its shares fell 2.2% in pre-market trading in New York.
The announcement came a few days after Nvidia signed an agreement to establish an artificial intelligence research and development center in Vietnam, which is widely seen as an effort by the U.S. chipmaker to reduce its reliance on China, amid the tit-for-tat China-U.S. chip row.
The Biden administration’s latest export controls were the third such round of restrictions on the sale of chips to China. The U.S. Commerce Department said the restrictions would slow China’s development of AI chips, which could, according to the U.S., be used to gain a military advantage.
China’s Commerce Ministry said such restrictions would pose “a significant threat” to the stability of global supply chains.
RELATED STORIES
Chipmaker Nvidia teams up with Vietnam for AI amid US-China row
Did NVIDIA describe Huawei as its ‘biggest competitor’?
US expands chip export ban to China
Nvidia has been a key supplier of high-performance GPUs and AI chips to Chinese companies. In the July quarter of 2024, China accounted for approximately 12% of Nvidia’s revenue, amounting to about US$3.7 billion – a more than 30% increase from the previous year.
Although Nvidia CEO Jenson Huang said in November that the chipmaker remained committed to maintaining its presence in mainland China, the U.S. chipmaker has also been eyeing ways to reduce its reliance on China.
Apart from Vietnam, Nvidia has increased partnerships and investments in other Southeast Asian countries in recent years including Thailand, Malaysia, Indonesia and Singapore.
Edited by RFA Staff.