Investing.com -- Taiwanese government authorities raided offices of Super Micro Computer Inc. on Monday as part of an investigation into alleged smuggling of Nvidia Corp. chips to China using the company's servers, according to a report by Bloomberg.

Local investigators searched the residences of six individuals and the sites of three affiliated companies on Monday, according to a statement from Taiwan's Keelung District Prosecutors Office. The office declined to name those searched but Super Micro's Taiwan office was among the locations raided.

The company’s shares quickly fell as much as 9% following the report before recouping some of the losses.

Super Micro previously stated it is cooperating with Taiwanese authorities on the investigation.

The raids represent an expansion of Taiwan's first public enforcement action against AI chip diversion. The U.S. has restricted exports of advanced AI chips to China over concerns the hardware could benefit Beijing's military efforts. The majority of these chips are produced in Taiwan.

Taiwan does not currently classify AI chip exports to China as a criminal offense. Authorities can warn potential sellers they may be violating U.S. rules, but local prosecutors can only charge suspected smugglers with violations of existing Taiwanese laws.

Taipei is now reportedly considering making such exports a crime, which would provide prosecutors with additional legal tools.

Data center operator Chief Telecom Inc. and Super Micro distributor Albatron Technology Co. were also raided on Monday, the report said. The Keelung District Prosecutors Office said it has summoned the individuals searched for interviews.