French government raids NVIDIA offices in France, faces huge fines and antitrust charges

NVIDIA has had its offices in France raided by the French government and is set to be charged by the French antitrust regulator for allegedly anti-competitive practices.

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The news is coming from Reuters and people with "direct knowledge of the matter" that makes this the first government to fight NVIDIA over anti-competitive behavior. The French authority has a statement of objections or chart sheet, which follows previous raids into the graphics card business in September 2023, which Reuters' sources said "targeted NVIDIA". These raids were part of a "broader inquiry into cloud computing".

NVIDIA's untouched dominance of the GPU market, but more specifically -- and far more dominantly -- in the AI GPU business, has put a France-sized magnifying glass over the chipmaker. This was amplified over the last year with generative AI leader OpenAI and its ChatGPT, which Reuters reports has been "triggering regulatory scrutiny on both sides of the Atlantic".

Reuters continued saying that the French authority, which publishes some but not all its statements of objections to companies, with NVIDIA (of course) declining to comment. NVIDIA said in a filing in 2023 that regulators from the European Union, China, and France had asked the company for information on its graphics cards.

The European Commission is "unlikely" to expand its preliminary review "for new" reports Reuters, since the French authority looking into NVIDIA "other people with direct knowledge said of the matter". The French watchdog discussed generative AI, citing the risk of abuse by chip providers (like NVIDIA) in a report published last week.

The French watchdog had concerns over the AI industry's dependence on NVIDIA's leading CUDA chip programming software, which is the only system 100% compatible with GPUs that have become the cornerstone of HPC and AI. They also voiced concerns of NVIDIA's recent investment into AI-focused cloud service providers, noting CoreWeave.

The possible punishment is up to 10% of their global annual turnover for breaching French antitrust rules, but Reuters adds that they can also provide concessions to "stave off penalties" which would be huge, because NVIDIA has topped the financial markets recently hitting a $3.3 trillion (that's with a T) market capitalization.

Reuters continued, adding that the US Department of Justice is taking the lead in investigating NVIDIA as it "divvies up" Big Tech scrutiny with the Federal Trade Commission, "a source familiar with the matter" told the outlet.