French Regulators Prepare Antitrust Charges Against Nvidia

French Regulators Prepare Antitrust Charges Against Nvidia

French Regulators Prepare Antitrust proceedings against Nvidia Corp., formally accusing the leading chipmaker of engaging in anticompetitive practices. This marks a global first amid intensified regulatory scrutiny.

Reuters Report and Regulatory Actions

According to Reuters, French authorities, citing unnamed sources familiar with the matter, plan to issue a statement of objections. This follows a raid on Nvidia’s offices in Santa Clara, California, last year. Nvidia has faced criticism for capitalizing on the AI spending surge, with its GPUs in high demand for data processing crucial to AI development.

French objections likely scrutinize Nvidia’s market dominance amid AI demand surge, potentially impacting global tech, WSJ Print Subscription said.

Market Reaction and Financial Impact

Nvidia’s shares saw a temporary decline of up to 3.8% on Monday in New York, despite their more than doubled value this year, catapulting the company’s market valuation above $3 trillion. Both Nvidia and French antitrust officials declined to comment on the developing situation to Bloomberg.

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Global Regulatory Scrutiny

Regulators in the US, EU, China, and the UK are investigating Nvidia’s dominant position in AI processors and pricing strategies. Nvidia has acknowledged scrutiny from multiple jurisdictions regarding chip shortages and market dynamics.

French Antitrust Law and Potential Penalties

Under French law, companies found guilty of antitrust violations can face fines up to 10% of their global annual revenue. The largest fine imposed by the French agency since 2011 was €1.24 billion ($1.33 billion) on Apple Inc. and two distributors in 2020.

European Commission’s Informal Review

The European Commission in Brussels has informally assessed Nvidia’s compliance with EU antitrust rules. However, no formal investigation has been initiated yet. French Finance Minister Bruno Le Maire has expressed concerns over Nvidia’s market dominance, advocating for a competitive market landscape.

This move by French regulators underscores the escalating scrutiny facing Nvidia as global authorities scrutinize its business practices amid concerns over fair competition in the semiconductor sector.

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