China alleges Nvidia violated antitrust legal guidelines in shopping for Mellanox

The Chinese language authorities has introduced that Nvidia violated enterprise antitrust legal guidelines when it acquired Israeli firm Mellanox for $6.9 billion in 2020. China started reviewing the acquisition in 2024, regardless that it had beforehand authorised the acquisition. Nevertheless, the Chinese language antitrust authority claimed that “it was authorised beneath sure circumstances,” with out specifying what the circumstances have been, nor did it specify the character of the suspicions in opposition to Nvidia.

Regardless of the Chinese language announcement, these are solely findings of a preliminary examination carried out by the antitrust authority there. The Chinese language authorities have clearly said that the process has not but been accomplished and that they’re persevering with to look at the information. In apply, in response to estimates, China’s intention is to create leverage over the US throughout the commerce talks presently happening between the international locations in Spain.

The merger deal was authorised in 2020 by regulators within the US, Europe and Israel – again when Nvidia was an organization value ‘solely’ $200 billion. Nobody imagined how the AI revolution that started in November 2022 with the launch of OpenAI’s ChatGPT would rework Nvidia from an organization well-known for graphics chips for laptop video games, to an organization that guidelines the AI world with large servers based mostly on its graphics processors value greater than $4 trillion.

Will a giant high-quality be imposed on Nvidia?

When China makes a ultimate determination on Nvidia, it might impose a high-quality starting from 1% to 10% of its income within the nation, which might attain $1.7 billion. Nvidia reported $17 billion in income from China over the past fiscal 12 months, 13% of its total income, however within the first half of 2025 its gross sales in China have been dramatically lowered as a result of Trump administration’s ban on the corporate promoting its distinctive H20 processors on the Chinese language market.

Mellanox has been seen as a useful acquisition for Nvidia. The communications chips produced in Yokneam and Tel Aviv permit knowledge to circulation easily and rapidly between Nvidia’s graphics processors, relieving bottlenecks in AI servers amid rising demand for AI processing.

Mellanox’s significance to Nvidia has been highlighted in latest quarters, when it emerged because the fastest-growing enterprise inside Nvidia and the second-largest element of the corporate’s income. Now, the Yokneam firm has change into one other stumbling block within the deteriorating relationship between the US and China.

Nvidia stated, “We adjust to the regulation in all respects. We’ll proceed to cooperate with all related authorities companies as they consider the impression of export controls on competitors within the industrial markets.”

Printed by Globes, Israel enterprise information – en.globes.co.il – on September 16, 2025.

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