When NVidia Advertise a purchase an arm For $ 40 billion, it may already be anticipating regulatory difficulties, but not one like this: The UK government has launched an intervention to investigate whether the deal could harm National Security.
ARM is headquartered in the United Kingdom. Nvidia is an American company. Although these countries do not face major political or economic struggles, the UK’s Department for Digital, Media, Culture and Sports (DCMS) has called for an investigation into businesses focused on national security, explains Oliver Dowden, Secretary of State. United kingdom:
We want to support our thriving UK tech industry and welcome foreign investment, but it is appropriate to consider adequately the national security implications of such a transaction.
Possibly the potential implications relate to the possibility that ARM, in a new trend, may have less stringent control over licensing its technology. This, in addition to being in billions of devices worldwide, is also used in the UK’s national security infrastructure and systems.
The investigation process is expected to be conducted by the UK Competition and Markets Authority (CMA), which is the UK’s antitrust body. The report with results is due to be released at the end of July 2021.
If competition or national security problems are not identified, DCMS can give a positive signal for business. Otherwise, the investigation might be sent to a second, deeper stage, or even blocked.
Nvidia tries to fend off fears
Nvidia commented on the investigation saying it did not believe the deal could jeopardize the UK’s national security. The company also said it continues to work closely with the UK authorities.
In the face of lingering doubts that the acquisition will dampen competition or cut jobs in the UK, for example, Nvidia has also said that it will maintain ARM’s current licensing policy and retain the company’s headquarters on British soil.