China Initiates Antitrust Investigation into Nvidia's Mellanox Acquisition

China's State Administration for Market Regulation (SAMR) has initiated an antitrust investigation into Nvidia's 2020 acquisition of Mellanox Technologies, alleging violations of the country's anti-monopoly laws. The regulator stated that Nvidia failed to fully comply with conditions set during the approval of the $6.9 billion acquisition of the Israeli-US networking supplier.

The preliminary investigation, which began in December 2024, found that Nvidia did not adhere to commitments made during the acquisition process. While specific details were not disclosed, the violations may be linked to conditions imposed to prevent anti-competitive practices and ensure interoperability with other vendors.

Nvidia, a leading AI chipmaker, faces potential fines ranging from 1% to 10% of its annual sales under Chinese antitrust law. The company has not yet responded to the ruling.

This development coincides with ongoing U.S.-China trade talks in Madrid, where officials are discussing tariffs and national security issues. The investigation is perceived as part of escalating tensions between the two countries, particularly over advanced semiconductor technologies.

Nvidia's shares dipped 2% in pre-market trading following the announcement.