The chipmaking giant is facing an investigation by the State Administration for Market Regulation (SAMR) in China for an earlier acquisition.
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Nvidia shares were under pressure in the pre-market trade on Monday after China accused the chipmaker of violating the country's anti-monopoly laws. The Antitrust Authority said it would step up scrutiny of the world's leading chipmaker, escalating tensions with Washington as the two countries hold trade talks this week in Spain.
Chinese regulators said a preliminary investigation found that Nvidia didn't comply with conditions imposed when it purchased Mellanox Technologies, a network and data transmission company.
The one-sentence statement from China's State Administration for Market Regulation did not mention any punishment, but said it would carry out "further investigation."
Nvidia has not responded immediately to Euronews Business' request for comment.
Regulators said in December that they were investigating the company for suspected violations stemming from the $6.9 billion (€5.87bn) acquisition of Mellanox. The deal was completed in 2020 after the Chinese regulator gave conditional approval.
Nvidia at the centre of the US-China trade war
The decision ramps up pressure on the US as officials from Washington hold trade talks in Spain with Beijing's representatives, and follows other moves by Beijing to increase scrutiny of the US chip industry.
On Saturday, China's Ministry of Commerce said it was carrying out an antidumping investigation into certain analogue IC chips imported from the US, including commodity chips commonly made by companies such as Texas Instruments and ON Semiconductor.
The ministry also announced a separate anti-discrimination probe into US measures against China's chip sector.
In talks scheduled to run from Sunday to Wednesday, US Treasury Secretary Scott Bessent is meeting Chinese Vice Premier He Lifeng in Madrid for negotiations on tariffs and national security issues related to the ownership of social media platform TikTok.
It's the fourth round of discussions after meetings in London, Geneva and Stockholm. The two governments have agreed to several 90-day pauses on a series of increasing reciprocal tariffs, staving off an all-out trade war.
California-based Nvidia has become central to the US-China trade war, as the two sides battle for tech supremacy. The artificial intelligence boom has fuelled demand for Nvidia's advanced processors, making it the world's most valuable company.
The company has faced restrictions on chip exports to China imposed by President Joe Biden's administration that were then reinforced by President Donald Trump. Nvidia won approval in July from the Trump administration to sell China its H20 graphics processing unit, which is less powerful and designed to comply with US export curbs.
