TMTPOST -- Nvidia Corporation dismissed on Thursday rumors that may resulted in an antitrust probe by the Chinese government.
Credit：Nvdiia
Recently, rumors that Nvidia has cut off supply in China went viral on social media, but they are false, the leading artificial intelligence (AI) chip maker said in a statement posted at Chinese microblogging platform Weibo on Thursday. “China is an important market for Nvidia,” the U.S. company said in the statement. “ Nvidia adheres to the customer-centric principle and will continue to provide Chinese customers with the highest quality, most efficient products and services.”
The rumors Nvidia abovementioned came as the Santa Clara, California-based company became a target of an antitrust investigation earlier this week. The probe was deemed as reminiscent of Nvidia’s out-of-supply record in China. Chinese personal media said Nvidia has been claimed to Chinese authorities for halting supply back to 2022, and the regulator has had initiated an investigation due to the accusation.
The State Administration for Market Regulation of China (SAMR) announced on Monday it has opened an investigation into Nvidia for suspected violation of the country's anti-monopoly law and the terms of a conditional approval that was granted on Nvidia's acquisition of Mellanox. The top market regulator said the decision was made in accordance with the law. It didn’t specify how Nvidia might have violated China’s laws and any commitments it made under terms in the regulator’s approval of that deal.
Nvidia completed in March 2019 acquisition of Mellanox for about US$6.9 billion in cash, marking the biggest the third largest-ever takeover of an Israeli high-tech company till that month. That was then the Santa Clara, California-based chip company’s biggest acquisition. China’s market regulator gave its conditional approval about a year later. The SAMR said in a statement in April 2020 that the deal was given the green light after Nvidia and Mellanox had agreed to provide an uninterrupted supply of graphics-processing units (GPUs) and networking equipment to China. It said Nvidia also promised not to discriminate against customers in China.
The probe is unlikely to have much of an impact on the company, particularly in the near term, because most of Nvidia’s most advanced chips are already restricted from being sold into China, commented TECHnalysis Research chief analyst Bob O'Donnell.
A company spokesperson responded China's probe that Nvidia strives to "provide the best products we can in every region and honor our commitments everywhere we do business. We are happy to answer any questions regulators may have about our business."
The investigation marks escalation of China-U.S. high-tech wars. The Biden administration last week launched its third crackdown in three years on China's semiconductor industry. The U.S Department of Commerce’s Bureau of Industry and Security (BIS) on December 2 unveiled a package of rules designed to further impair China’s capability to produce advanced-node semiconductors that can be used in the next generation of advanced weapon systems and in AI and advanced computing.
The rules include new controls on 24 types of semiconductor manufacturing equipment and 3 types of software tools for developing or producing semiconductors; new controls on high-bandwidth memory (HBM); new red flag guidance to address compliance and diversion concerns; 140 Entity List additions and 14 modifications spanning Chinese tool manufacturers, semiconductor fabs, and investment companies involved in advancing the Chinese government’s military modernization; and several critical regulatory changes to enhance the effectiveness of the previous controls, according to a press of the BIS.
Days after the U.S. announcement of new curbs, China’s Ministry of Commerce (MOFCOM) announced it made a decision to tighten the control over the export of relevant dual-use items to the United States, to safeguard national security and interests and fulfill non-proliferation and other international obligations.
The export of dual-use items to U.S. military users or for military purposes is prohibited. In principle, the dual-use items related to gallium, germanium, antimony and superhard materials is not allowed to export to the United States, while stricter examinations on end-users and end-use purposes are to be conducted regarding exports of the dual-use item of graphite to the United States.
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