June 5 (Reuters) - The U.S. Justice Department and the

Federal Trade Commission have reached a deal that allows them to

proceed with antitrust investigations into the dominant roles

that Microsoft ( MSFT ), OpenAI and Nvidia ( NVDA ) play in the

artificial intelligence industry, according to a source familiar

with the matter.

Under the deal, the U.S. Department of Justice will take the

lead in investigating whether Nvidia ( NVDA ) violated antitrust laws,

while the FTC will examine the conduct of OpenAI and Microsoft ( MSFT ).

While OpenAI's parent is a nonprofit, Microsoft ( MSFT ) has invested $13

billion in a for-profit subsidiary, for what would be a 49%

stake.

The Microsoft-OpenAI partnership is also under informal

scrutiny in other regions.

The regulators struck the deal over the past week and it is

expected to be completed in the coming days, the person said.

The FTC is also looking into Microsoft's ( MSFT ) $650 million deal

with AI startup Inflection AI, a person familiar with the matter

said.

The probe was first reported by the Wall Street Journal and

the regulators' agreement by the New York Times.

OpenAI and Nvidia ( NVDA ) did not immediately reply to requests

for comment on Thursday. Microsoft ( MSFT ) said it has complied with its

legal obligations.

The moves signal growing regulatory scrutiny into the AI

industry. In January, the FTC ordered OpenAI, Microsoft ( MSFT ),

Alphabet Amazon and Anthropic to provide

information on recent investments and partnerships involving

generative AI companies and cloud service providers.

In July last year, the FTC opened an investigation into

OpenAI on claims it had run afoul of consumer protection laws by

putting personal reputations and data at risk.

Last week, U.S. antitrust chief Jonathan Kanter referred to

"structures and trends in AI that should give us pause," at an

AI conference, adding that the technology relies on massive

amounts of data and computing power, which can give

already-dominant firms a substantial advantage.