Semiconductor Strain Surges Between US and China
Commercial tensions between the United States and China in the semiconductor sector have intensified. On Monday, China’s State Administration for Market Regulation alleged that US semiconductor maker Nvidia violated the country’s competition laws, TechCrunch reported.
The accusation primarily relates to Nvidia’s $7 billion acquisition of computer networking supplier Mellanox Technologies in 2020.
In a statement, Nvidia said, “We respect all laws and will continue to cooperate with the relevant government authorities.”
While China has not announced any direct penalties yet, the investigation is ongoing. The ruling could influence ongoing US-China trade discussions in Madrid. Although these talks are not solely about semiconductors, Nvidia chip supplies in China remain a contentious issue.
Despite changes in the US administration, tensions persist. Earlier this year, the Biden administration issued the AI Diffusion Rule, restricting US AI chip exports to China. Although it was rescinded in May, the Trump administration later introduced a licensing system for chip exports to China and permitted conditional sales.
Under a recent deal, 15 percent of revenue from chip sales in China is allocated to the US, but Chinese authorities are reportedly discouraging companies from purchasing Nvidia chips. According to the latest reports, not a single Nvidia chip has yet reached China under the new export process.
