China Drops Google Antitrust Case Amid Trade Talks, FT Reports; Nvidia Could Face Similar Resolution

China has decided to drop its antitrust probe into Google’s Android operating system, a move seen as a strategic gesture as Beijing and Washington intensify negotiations over trade, TikTok, and semiconductors, the Financial Times reported, citing people familiar with the matter.

The State Administration for Market Regulation (SAMR) formally opened the Google investigation in February, focusing on the dominance of the Android ecosystem and its impact on Chinese smartphone makers such as Oppo and Xiaomi. The case has now been terminated under a status known in China as zhongzhi.

People briefed on the decision said Beijing is recalibrating its regulatory strategy, narrowing its retaliatory targets to make them more potent. The move frees regulators to concentrate their scrutiny on Nvidia, which Beijing is now treating as leverage in ongoing trade talks.

“Drop one case but seize the other,” said one person familiar with the discussions, suggesting that China is using selective enforcement to sharpen its negotiating power. Analysts described the Google decision as largely symbolic, given Alphabet Inc.’s limited consumer-facing presence in China. “Google barely has any meaningful business in China — this is purely a symbolic gesture of goodwill,” said Vey-Sern Ling, managing director at Union Bancaire Privée.

The timing coincides with high-stakes negotiations between the US and China. Delegations met this week in Madrid for three days of talks on tariffs, export controls, and the forced divestment of TikTok. US President Donald Trump is expected to finalize a TikTok deal when he speaks with President Xi Jinping on Friday. The framework under discussion would create a new US entity to operate the app, with investors including Oracle, Silver Lake, and Andreessen Horowitz controlling about 80%, and Chinese shareholders holding the rest.

Meanwhile, Nvidia is under rising regulatory pressure in China. Earlier this week, SAMR said the company had violated antitrust law in its $7 billion acquisition of Mellanox Technologies, a deal conditionally approved in 2020. Separately, the Cyberspace Administration of China (CAC) ordered firms including ByteDance and Alibaba to halt purchases and testing of Nvidia’s RTX Pro 6000D, a chip designed for the Chinese market just two months ago. Several companies had already begun large-scale verification before regulators intervened.

If found in violation, Nvidia could face fines of 1% to 10% of its previous year’s sales. At the same time, Beijing has also launched an anti-dumping probe into certain US-made semiconductors, such as those from Texas Instruments.

While Google continues to profit in China mainly through cloud services and advertising sold to companies targeting overseas markets, the decision to drop the probe signals Beijing’s willingness to show flexibility. The spotlight now shifts to Nvidia, which could face both heightened scrutiny and the possibility of a negotiated settlement as trade talks progress.