China’s merger control regulator is still weighing whether to call in Qualcomm’s proposed acquisition of Alphawave, according to five sources familiar with the matter. This deliberation comes after receiving comments lodged from both international and domestic third parties, according to the first source.

The State Administration for Market Regulation (SAMR) has so far not decided to call in the USD 2.4bn deal, according to the first two sources. Qualcomm has not heard anything or received any new request from SAMR for some time, according to the third, fourth, and fifth sources.

No written notice has been issued by SAMR, a third source stated. The US chip giant has little information about what SAMR is considering, as the company’s strategy has been to not proactively engage, according to the fourth source.

On the other hand, several third parties — from competitors to downstream customers, both domestic and international — have lodged complaints to SAMR about the combination, according to the first and fourth sources.

In the past few months, SAMR has reached out to Chinese industry participants, including trade associations, to collect comments on the USD 2.4bn deal between a US chip giant and a Canada-founded London-listed high-speed connectivity solution provider, according to the two sources.

At least one international competitor, as well as two Chinese internet giants, expressed their concerns over the deal, according to the first source. The source declined to name the complainants.

The concerns mainly center on SerDes IPs, which are a type of connectivity IP needed for data center chips and also a core product and service of Alphawave, according to the first source.

As reported by this news service, competitors in the industry have complained to the US and German authorities about the merger. The US Federal Trade Commission’s (FTC’s) interest in the deal likely centered around a vertical theory under which Qualcomm could foreclose competitors from access to SerDes IP.

A previous report on 18 July noted that the FTC approached downstream competitors, including chipmaker Marvell Technology, for comments on the deal. The report said it is likely that other competitors, such as Broadcom, MediaTek, and others, were also approached.

A sixth source familiar with the matter told this news service that Synopsys also received a request for information from the FTC at that time.

Chinese internet companies with large demands for artificial intelligence (AI) chip procurement may have concerns around the deal regarding SerDes IP, according to the first source.

A late October post circulated in the IT community revealed details from an internal ByteDance tech expert meeting. The notes indicated that while the Chinese internet giant’s first-generation self-developed card uses Alphawave’s 112Gbps SerDes IP, its one-year license agreement poses a risk of supply disruption if Alphawave is going to be acquired by Qualcomm.

Despite the complaints, SAMR may be influenced by the overall geopolitical sentiment when it makes the definitive call-in decision, according to the first and second sources.

According to a seventh source familiar with the matter, another reason that SAMR appears to be moving forward slowly on the deal is that the division that is handling the deal is now under official reshuffling, which has caused the agency to be shorthanded.

Qualcomm and Alphawave did not respond to a request for comment. ByteDance and Synopsys had no comment.

SAMR does not comment on ongoing deals.