Casting further doubt on Nvidia’s attempt to purchase Arm Holdings, EU regulators have opened a formal investigation.

Nvidia announced in September 2020 that it had reached a deal to acquire Arm Holdings. Arm is one of the leading semiconductor design firms, licensing its designs to companies for use in their products. Some of the biggest names in tech, including Apple, Google, Qualcomm, Samsung and Nvidia, all use Arm’s designs.

The deal drew immediate scrutiny, with critics concerned Nvidia would undermine Arm’s traditional way of doing business. The company has always been strictly neutral, licensing its designs to any company willing to pay. Critics were concerned Nvidia might withhold Arm’s best designs for itself, giving it a competitive advantage.

The UK, where Arm is based, has already launched probes and investigations over competitive and national security concerns, and signaled it may seek to block the deal. According to Reuters, the EU is also getting in on the action, launching their own probe. The EU is evidently not satisfied with the concessions Nvidia has been willing to make for the deal to move forward.

“Whilst Arm and Nvidia do not directly compete, Arm’s IP is an important input in products competing with those of Nvidia, for example in datacentres, automotive and in Internet of Things,” EU competition chief Margrethe Vestager said.

“Our analysis shows that the acquisition of Arm by Nvidia could lead to restricted or degraded access to Arm’s IP, with distortive effects in many markets where semiconductors are used,” she continued.

The Commission will decide by March 15 whether the deal may move forward.