The People’s Republic of China has decided that the American company Nvidia has violated PRC anti-trust laws and is holding the company hostage in trade negotiations with the US.

China’s antitrust regulator said Monday that a preliminary investigation found Nvidia violated the country’s antimonopoly law in connection with an acquisition of an Israeli company that was completed in 2020. The regulator said the investigation was continuing, and it didn’t elaborate on the alleged violations or say whether it would punish Nvidia.

The PRC is centering its case on Nvidia’s commitment to not cut the PRC off from its chips as a condition of PRC approval of the acquisition. That might make a basis for a legitimate anti-trust beef; however:

Since 2022, the US. government has blocked Nvidia and other American chip vendors from selling many of their top-flight artificial-intelligence chips to China.

Here is the PRC threatening an American company for its compliance with American law.

There are now two strong reasons for American companies to walk away from the PRC and discontinue all business with PRC-domiciled companies or within the PRC under any guise. One is the overt interference with the domestic affairs of our nation. If the PRC doesn’t like our government’s block of Nvidia, et al., selling their best chips into the PRC, its beef is with our government, not with the American businesses it tries to take hostage in its “negotiations” with our government.

The other reason is the PRC’s presumption that it should have veto authority over whether an American company acquires, or otherwise takes a stake in, any non-PRC-domiciled company. If American companies stop doing business in/with the PRC, then the PRC has no approval/disapproval authority over acquisitions—it becomes irrelevant. And that’s as it should be with an enemy nation.