Bridge Data Centres Replaces Client Under Investigation in Malaysian Data Center

Bridge Data Centres Replaces Client Under Investigation in Malaysian Data Center

April 9, 2026

In a significant move highlighting the heightened regulatory scrutiny surrounding the global semiconductor supply chain, Asia-Pacific data center operator Bridge Data Centres has terminated its relationship with a Southeast Asian provider amid a multinational chip smuggling probe. The incident underscores the complex compliance challenges facing data center operators as geopolitical tensions increasingly intersect with digital infrastructure.

According to a report by Bloomberg, Singapore-based IT infrastructure provider Megaspeed International Pte has been removed from one of Bridge's facilities in Malaysia. Megaspeed had previously been allocated 68.4 megawatts of capacity at the site, a substantial power commitment indicative of large-scale operations. Bridge has since reallocated this entire capacity to cloud computing specialist Zenlayer, as confirmed in a memo the data center firm sent to its lenders in February.

The action follows an investigation launched by American and Singaporean authorities last October, after a New York Times report alleged Megaspeed violated U.S. export controls. The report accused the company of smuggling chips into China and leasing compute power to Chinese firms from Southeast Asian data centers equipped with Nvidia hardware. Bridge, which is reportedly in talks with lenders to secure up to $6 billion in loans to fund its expansion, did not publicly cite a specific reason for the client switch.

Megaspeed has vigorously denied the allegations. In a statement on its website, the company said, "We would like to clarify that the article contains misleading information and incorrect insinuations, including suggestions that we may have been involved in illegal chip transfers." It added, "We operate fully within the bounds of all applicable export control regulations and maintain the highest standards of legal and ethical conduct," noting it had undergone inspections by the U.S. Commerce Department, Malaysia’s Ministry of Investment, Trade and Industry, and Nvidia.

The replacement of a major tenant underscores the growing operational and financial risks for data center operators entangled in the broader tech trade war. Providers are now compelled to conduct enhanced due diligence on clients' end-use and compliance postures, as hosting companies under investigation can lead to reputational damage, regulatory complications, and sudden vacancy risks. This case may prompt stricter vetting processes industry-wide, particularly in strategic hubs like Southeast Asia, where data center growth is accelerating.

Source: datacenterdynamics