China's competition regulator has launched an investigation into Qualcomm's purchase of Israeli firm Autotalks, the latest salvo in the escalating tech trade war between Washington and Beijing.

The State Administration for Market Regulation (SAMR) described its probe as routine, according to state-run broadcaster CGTN, yet the timing is pointed. It came as China tightened exports of rare earth metals last Thursday, ratcheting up tensions with the US.

In response, Donald Trump – taking a break from bringing eternal peace to the Middle East – threatened additional tariffs of 100 percent on Chinese imports.

Qualcomm has now attracted scrutiny for its acquisition in June of Autotalks, an Israeli firm "devoted to vehicle-to-everything (V2X) communications." The company has operations in North America, Germany, France, China, Japan, and Korea – all the major automaking powers.

Qualcomm had abandoned an earlier bid for Autotalks over concerns about regulatory approval. Presumably, the San Diego-based chip giant felt approvals were in the bag when it finally sealed a deal earlier this summer.

However, SAMR has reportedly questioned whether Qualcomm jumped the gun, failing to inform the regulator of key details. Carthage Capital founder and managing partner Stephen Wu notes that China is pushing for standardization of vehicle communications.

Wu added that SAMR could have imposed a "no-harm jumping the gun penalty" but might be eyeing up more stringent action.

Citing an SAMR official, CGTN said: "The authority intervened although the deal fell below standard notification thresholds, as it had evidence the merger could have an anti-competitive effect."

SAMR told Qualcomm in 2024 that it should file for a review of the Autotalks acquisition, but the US chipmaker had not done so when the deal restarted this summer.

"Following new complaints, SAMR verified the facts, which Qualcomm acknowledged, leading the regulator to formally open a case for the illegal implementation of a concentration of undertakings," CGTN said.

While the Qualcomm probe is ostensibly routine, it's hard not to view it in the context of the broader tech and tariffs war between the US and China.

China has long wielded its dominance of the rare earths trade as leverage in trade negotiations. Last week, it railed against "double standards" on Washington's part and criticized the US's "unilateral long-arm" measures.

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Last month, SAMR said an initial investigation into Nvidia had found that the GPU giant had violated the country's competition rules as well as a conditional approval on a 2020 acquisition of Mellanox.

The US government had banned Nvidia from selling its top-end GPUs to China. Beijing has, in its turn, warned Chinese firms from buying the tailor-made Nvidia parts the US has approved for the China market.

Trump and Chinese leader Xi Jinping are due to have a sit-down to thrash out trade matters, and presumably other global problems. Trump threatened to cancel it before asserting over the weekend the meeting had not been cancelled. ®