Nvidia Broke Antitrust Law, China Says, as Tensions With U.S. Mount

Business|Nvidia Broke Antitrust Law, China Says, as Tensions With U.S. Mount

China’s antimonopoly regulator said on Monday that Nvidia, America’s leading chip maker, had violated the country’s antitrust law, the latest sign of tension between Beijing and Washington.

The announcement stemmed from an investigation that China opened against Nvidia last December. The Chinese authorities said Monday they would continue the investigation.

The State Administration for Market Regulation issued its finding as negotiators from China and the United States were meeting in Madrid to try to hash out mounting trade tensions.

In an escalating tit for tat in the days leading up to the regulator’s decision, the United States had added 23 Chinese firms to a list of companies that are barred from buying American technology and other exports because of national security concerns. And China said it was investigating American suppliers of certain integrated circuits.

Nvidia did not immediately respond to a request for comment. Nvidia’s stock fell more than 2 percent in premarket trading in New York.

In 2020, China approved Nvidia’s acquisition of Mellanox Technologies, a company that makes computer networking equipment. On Monday, it said that Nvidia had violated commitments the company made during the deal to prevent anti-competitive practices and ensure supplies to China.

Nvidia has found itself caught in the middle of a heated contest between the United States and China for primacy over artificial intelligence. Jensen Huang, Nvidia’s chief executive, sees the ability to do business with China as crucial to the company’s efforts to keep its position as the leading maker of A.I. chips. Global demand for Nvidia’s chips has made it one of the most valuable companies in the world.

This year, Mr. Huang persuaded President Trump to allow Nvidia to sell certain chips to China, drawing a backlash from critics who argued allowing access to the technology would aid China in its own technological development.

And in July, China’s internet regulator said that it had summoned Nvidia to explain security risks associated with one of its chips developed for the Chinese market, saying the chips could be shut down remotely or used to track a user’s location.

Xinyun Wu contributed reporting from Taipei, Taiwan.