The UK’s Competition and Markets Authority (CMA) recommended to initiate the second phase of the investigation into the Nvidia-ARM deal. The regulator fears that the tech giant could impede the adoption of innovation in a number of sectors.
“We are concerned that Nvidia’s control over ARM could create real problems for Nvidia’s competitors, restricting their access to key technologies and, ultimately, stifling innovation in some important and growing markets. This could result in consumers missing out on new products or facing higher prices,” said Andrea Coscelli, the CMA’s chief executive.
The regulator believes that Nvidia could restrict access by other chipmakers to ARM’s intellectual property. This would slow the adoption of innovation, CMA added.
“This includes critically important data-processing technologies and data centers that support digital enterprises across the economy, as well as the future development of artificial intelligence technologies that will matter for such growing sectors as robotics and autonomous vehicles,” said Coscelli.
On 20 July 2021, the CMA submitted its competition investigation report to the Secretary of State for Digital, Culture, Media and Sport. It includes a summary of statements from third parties regarding public interests and national security. During the first phase of the investigation, the CMA closely cooperated with other antitrust authorities worldwide to examine the implications of the deal in detail.
The Secretary of State will decide whether to open the second phase into competition and national security, or whether it should be returned to the CMA for assessment of only competition risks. The Department will determine the timing of this decision.
In April, the UK government intervened in the $40 billion Nvidia-ARM deal over ‘national security’ concerns.
Against the backdrop of the proceedings, experts have concluded that the odds of a merger between the two semiconductor manufacturers do not exceed 10%.
In May, one of the designers of ARM’s microprocessor architecture criticised the plans to acquire the company and said that, if the deal goes ahead, the company would engage in unfair competition.
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