The European Commission (EC) raised concerns a big money Nvidia deal to acquire chip design company Arm could lead to higher prices, less choice and reduced innovation in the semiconductor industry, as it opened a detailed investigation into the acquisition.

In a statement the EC noted it was worried Nvidia could ultimately restrict access to Arm’s technology by rival chipmakers.

The $40 billion deal was announced more than a year ago, but has since faced regulatory scrutiny in a number of markets as companies including Google and Microsoft have reportedly urged authorities to scuttle the move.

EC competition regulators already took a preliminary look at the deal and Nvidia offered concessions earlier this month.

The authority noted Nvidia’s promises were “insufficient to clearly dismiss its serious doubts as to the effect of the transaction”.

EC EVP for competition Margrethe Vestager (pictured) said while Arm and Nvidia don’t directly compete, the former’s intellectual property (IP) was important for the chipmaker’s rivals across processors for data centres, the automotive industry and IoT.

“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.”

The EC’s “investigation aims to ensure that companies active in Europe continue having effective access to the technology that is necessary to produce state-of-the-art semiconductor products at competitive prices”.

It is working to a deadline of 15 March 2022 for the probe.