Qualcomm Inc. (NASDAQ:QCOM) reportedly admitted to completing its acquisition of Israel semiconductor design firm Autotalks without notifying Chinese authorities.
Chinese Regulator Says Qualcomm Did Not Seek Approval
China’s State Administration for Market Regulation (SAMR) stated that it had informed Qualcomm in March 2024 that the acquisition required regulatory approval, according to a Reuters report.
Qualcomm, however, proceeded with the acquisition in June without informing the regulator, which led to the antitrust probe.
The investigation aims to determine if Qualcomm violated China’s antitrust laws by not declaring certain details of the acquisition.
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Qualcomm Shares Tumble
Following the news, Qualcomm’s shares dropped over 5% on Friday.
The decline was further impacted by President Donald Trump’s threat to increase tariffs against China and cancel a planned meeting with President Xi Jinping.
Increasing Regulatory Scrutiny
The probe comes at a time when regulatory bodies worldwide, including the European Commission, are closely examining Qualcomm’s business moves. The EU had previously mandated Qualcomm to seek antitrust approval for the same acquisition, despite the transaction not meeting the usual monetary thresholds for such reviews.
Trump’s recent tariff threats against China have already caused significant ripples in the stock market, with major indices like the Nasdaq Composite experiencing notable declines.
Robin Brooks, a senior fellow at the Brookings Institution, stated that these tariffs could potentially harm the U.S. economy more than intended.
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