NVIDIA has submitted an application to regulators in China asking them to approve its $40bn takeover of British microprocessor designer ARM.

Chinese antitrust regulators could take between a year and 18 months to complete its review of the deal, according to the Financial Times, which first reported the news.

Arm is owned by Japan-headquartered Softbank, but it has a joint venture in China called “Arm China” with Chinese private equity company Hopu Investments.

It is this part of the company that has put the takeover in the crosshairs of China’s Ministry of Commerce and China’s State Administration for Market Regulation.

The Nvidia deal also faces opposition from semiconductor companies in China, who are concerned about Arm shifting to US ownership. It is further complicated by Arm China’s botched dismissal of its head Adam Wu, who has refused to leave and is now suing the company.

Nvidia first announced its plans to take over Arm in September 2020 and had been hoping to finalise the deal in the first quarter of 2022. It has remained confident in receiving approval in this timeline despite mounting scrutiny.

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By GlobalData

In the UK the merger is undergoing a review by the Competition and Markets Authority on “national security grounds”. The competition watchdog is due to compile a report on 30 July.

In February, EU competition officials were gearing up to scrutinise the deal and the US Federal Trade Commission also opened a probe into the acquisition.

Arm was purchased by SoftBank in 2016 in a move that then caused shockwaves in the UK tech sector.

Founded in 1990, Arm is a key player in the technology ecosystem. Its semiconductor designs are licensed for use in the majority of smartphones and a wide range of electronic devices including laptops, servers and smart TVs.

Nvidia’s main business has been graphics processing units for the gaming industry, automotive and enterprise solutions, but it also produces processors and systems-on-chips, often using Arm designs.

Antitrust regulators are concerned that the acquisition could give Nvidia the ability to raise prices or reduce the quality of products to rival – a claim that Nvidia has consistently rejected.