The hostile takeover - Qualcomm had rejected Broadcom's offer - had been under investigation by the Committee on Foreign Investment in the United States, or CFIUS. That could leave the US hobbled in the race to develop next generation, 5G wireless technology, according to people familiar with the matter.
Broadcom's attempted takeover came as companies around the world are gearing up to build ultra-fast "5G" mobile networks that could tip the balance of power in technology.
The requirement showed that CFIUS, an inter-agency panel led by the U.S. Treasury, was aware that its jurisdiction could be contested if Broadcom redomiciles to the United States.
The Committee on Foreign Investment in the United States, which reviews the national security implications of foreign investments in US companies, cited concerns about Broadcom's penchant for cutting costs such as research spending.
Sources had told Reuters on Tuesday that Broadcom was ready to scrap its bid for Qualcomm.
Should that happen, Chinese companies such as Huawei, which the CFIUS has previously expressed concerns about, could take a larger, or even a dominant, role in setting 5G technology and standards and practices.
The probe is triggered whenever a foreign entity tries to become the new owner of a company that is largely based and operates in the USA, which fits this situation to a tee.
Broadcom has confirmed that it will withdraw its offer to acquire rival chip company Qualcomm.
And not everyone thinks the USA national security concerns over the deal are justified.
"We'll have to see if management change is in the offing - it looks like investor confidence in management is low", said Stacy Rasgon, an analyst at Sanford C. Bernstein.
Most analysts assume Broadcom will now walk away from Qualcomm, with some flagging San Jose-based Xilinx Inc and Israel's Mellanox Technologies Ltd, both diversified makers of communications chips, as likely next targets.