China’s market regulator has found that United States chipmaker Nvidia may have breached the country’s anti-monopoly laws, according to a preliminary probe, and said the investigation will continue.

Following the announcement, Nvidia’s shares dropped about 2% in premarket trading.

The probe, initiated late last year by China’s State Administration for Market Regulation, focuses on Nvidia’s 2020 acquisition of Israeli networking technology company Mellanox, a deal previously approved by Chinese authorities under certain conditions.

SAMR’s preliminary findings suggest that Nvidia violated regulations related to the acquisition and its stipulated conditions, as the investigation remains ongoing.

This coincides with ongoing trade talks between the U.S. and China in Madrid.

US and Chinese officials will continue trade talks in Spain on Monday, with attention fixed on the looming deadline for ByteDance to divest TikTok or face a US ban.

Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng are leading the negotiations, which represent the latest effort to ease trade frictions between Washington and Beijing.

Their last meeting in July produced a 90-day extension of the tariff truce, now set to expire on November 10.