NVIDIA's anticipated acquisition of ARM to be investigated


20-04-2021

The Government has annnounced its intention to intervene in the proposed acquisition of ARM with NVIDIA.

Digital Secretary Oliver Dowden has issued a Public Interest Intervention Notice (PIIN) confirming that he is intervening in the proposed acquisition of ARM Limited by NVIDIA Corporation.

He has written to the Competition and Markets Authority (CMA) to inform them of his decision and has instructed them to begin a ‘phase one’ investigation to assess the transaction.

The CMA will now prepare a report with advice on jurisdictional and competition issues. The report will also include a summary of any representations it receives on potential national security issues arising from a consultation it will launch to gather third-party views. Alongside the CMA’s process, the government will examine the national security public interests.

The Digital Secretary, who has ‘quasi-judicial’ powers under the Enterprise Act 2002 to intervene in certain mergers on public interest grounds, has issued the notice to ensure that any national security implications for the United Kingdom are explored.

ARM, which is headquartered in Cambridge, is a major global player in the semiconductor industry. Semiconductors are fundamental to current and future technologies – from artificial intelligence and quantum computing to 5G. Semiconductors also underpin the UK’s critical national infrastructure and are found in defence and national security related technologies.

Digital Secretary Oliver Dowden said: “Following careful consideration of the proposed takeover of ARM, I have today issued an intervention notice on national security grounds.

“As a next step and to help me gather the relevant information, the UK’s independent competition authority will now prepare a report on the implications of the transaction, which will help inform any further decisions.

“We want to support our thriving UK tech industry and welcome foreign investment, but it is appropriate that we properly consider the national security implications of a transaction like this.”

The ‘phase one’ investigation will ensure specific considerations around competition, jurisdiction and national security are assessed.

It will advise whether the acquisition results in a substantial lessening of competition in any market in the UK, and whether it would be appropriate to deal with any concerns through undertakings by the parties involved in place of a referral to a ‘phase two’ investigation.

The CMA has until midnight at the end of 30 July 2021 to complete and submit this report to the Digital Secretary.

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A spokesperson for Nvidia said: "Regulatory review is confidential. The UK government regularly reviews national security issues and a public interest intervention is a step in this process. We remain in ongoing contact with the government."