[News] Beijing Says NVIDIA Violated Anti-Monopoly Law, Potential Fines Up to 10% of China Sales

According to CNBC, China’s market regulator said Monday that a preliminary investigation found NVIDIA in violation of the country’s anti-monopoly law, adding that Beijing will continue its probe into the U.S. chipmaker. As Bloomberg indicates, China’s State Administration for Market Regulation (SAMR) stated in a brief one-sentence announcement that the U.S. firm had violated antitrust rules, but provided no further details.

As noted by CNBC, SAMR had launched an investigation late last year into NVIDIA’s acquisition of Mellanox and certain related agreements. In its preliminary findings, the regulator said NVIDIA had breached China’s anti-monopoly laws.

NVIDIA acquired Mellanox, a provider of networking solutions for data centers and servers, in 2020 in a deal that China approved with conditions at the time, CNBC adds.

In terms of potential consequences, Reuters notes that under China’s antitrust law, companies can be fined between 1% and 10% of their previous year’s annual sales. According to NVIDIA’s latest annual report, China generated $17 billion in revenue in the fiscal year ending January 26, representing 13% of total sales.

Meanwhile, Reuters highlights that the regulator’s announcement also coincides with ongoing U.S.–China trade talks in Madrid, where semiconductors — including those produced by NVIDIA — are expected to be on the agenda.

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(Photo credit: NVIDIA)