"China Investigates Nvidia for Halting Supply Due to US Export Controls"

China Daily Report
"NVIDIA Fails to Keep Promise"

Reports have emerged that the reason behind China's antitrust investigation into the US company Nvidia is that Nvidia, contrary to its initial promises, stopped supplying products to China based on US government export controls.

The state-run English-language newspaper China Daily reported this on the 11th. According to the report, Nvidia, the world's leading artificial intelligence (AI) semiconductor company, acquired Israeli semiconductor firm Mellanox in 2019.

Concerns arose that this acquisition could strengthen Nvidia's market dominance in the semiconductor sector, potentially excluding or restricting competition in global and Chinese markets for graphics processing unit (GPU) AI accelerators. In response, Nvidia made several commitments to China to resolve these issues, after which Chinese authorities approved the merger.

Specifically, these commitments included the continued supply of Nvidia GPU accelerators, Mellanox high-speed network interconnect equipment, related software, and accessories to the Chinese market.

However, China Daily explained that Nvidia has recently halted the supply of several GPU accelerator products to China over the past few years, citing US government export controls as the reason.

China Daily stated, "This infringes upon the legitimate rights and interests of relevant Chinese companies," and added, "It is not surprising that Nvidia is under investigation for alleged violations of antitrust laws."

At the same time, China Daily distanced itself from analyses suggesting that the Nvidia investigation is a warning message to the upcoming Donald Trump administration or related to the AI hegemony competition between the US and China. It cited the fact that Nvidia is also under antitrust investigation in the US and that the European Union (EU) antitrust authorities are conducting an investigation into Nvidia's potential unfair sales practices.

On the 9th, China's State Administration for Market Regulation announced that it had launched an investigation into Nvidia for alleged violations of antitrust laws but did not disclose specific reasons. China accounts for about 16% of Nvidia's revenue, the second largest after the US.