Broadcom reportedly finds itself in the crosshairs of Chinese regulators over concerns about its network switches being deployed in state-owned data centers.

According to the FT, the Assets Supervision and Administration Commission (SASAC), responsible for managing state-owned businesses, is overseeing a project looking into ways domestic alternatives could be used in compute infrastructure over foreign hardware.

The report suggests Broadcom equipment is receiving particular scrutiny, with some 90% of government-run enterprises relying on its switches. Hardware from Broadcom rivals is already barred from state-owned facilities.

The probe is reportedly looking into whether Broadcom’s position has limited local market reach alternatives like Huawei. The FT suggests Chinese vendors H3C and Ruijie are touted as leading options on Chinese government procurement guidelines.

SASAC’s inquiry comes amid growing interest among Chinese officials to support the local infrastructure market, while responding to U.S. export sanctions in kind. The government is aiming for around 80% semiconductor self-sufficiency by the start of the next decade, while AI and related infrastructure were key tenets of the country’s 15th Five-Year Plan approved earlier this year.

Any potential move comes as U.S. officials have placed ever-more stringent sanctions on exports of high-end AI chips and related manufacturing equipment. Networking may be the next target, with Trump administration officials believed to be mulling over banning imports of Chinese optical transceivers – in what would be a major blow to U.S. hyperscalers.

Any potential action by SASAC in China, however, would not impact Broadcom deployments in sites operated by the likes of Alibaba or TikTok parent ByteDance.