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 An array of industries have been coming under the spotlight as China
intensifies efforts to bring companies into compliance with an
anti-monopoly law enacted in 2008.
The auto sector has been under particular scrutiny, and the National
Development and Reform Commission (NDRC), China's state planner, has
been investigating it amid accusations by state media that global
car makers are overcharging consumers.
European car brands including Volkswagen AG's Audi, BMW and
Mercedes-Benz are scrambling to lower prices for new cars and spare
parts in an effort to appease Chinese regulators who have accused
some of them of anti-competitive behavior.
The European Chamber said that while effective enforcement of the
anti-monopoly law would help develop a "healthy market economy" in
China, it was concerned about the way investigations were being
carried out.
"Inspections must not prejudge the outcome of the investigation and
full rights of defense must be afforded to the companies in
question. Disconcertingly, the European Chamber is not convinced
that this has systematically been the case in China's recent
investigations," it said in a statement.
"The European Chamber has received numerous alarming anecdotal
accounts from a number of sectors that administrative intimidation
tactics are being used to impel companies to accept punishments and
remedies without full hearings," it said.
"Practices such as informing companies not to challenge the
investigations, bring lawyers to hearings or involve their
respective governments or chambers of commerce are contrary to best
practices," it said.
European business are also increasingly wondering whether foreign
companies are being disproportionately targeted, said the chamber,
which has more than 1,800 member companies in China.
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"In some of the industries under investigation, domestic companies
have not been targeted for similar violations. Furthermore, in some
cases that involve joint ventures, it has only been the foreign
partner that has been named as being a party to the investigations,"
it said.
The NDRC did not answer telephone calls seeking comment.
Chinese authorities say the law is applied to both domestic and
foreign firms, with the aim of protecting consumers. The NDRC has
said it has targeted domestic telecoms companies, including China
Unicom and China Telecom Corp, and domestic financial institutions
for anti-trust practices.
U.S. companies have also been caught up in the investigations,
including software giant Microsoft Corp, and chipmaker Qualcomm Inc
which faces the prospect of a $1 billion fine.
Such investigations have rekindled concerns that the Chinese
government may be using the anti-monopoly law to support domestic
firms at the expense of foreign companies.
(Reporting by Ben Blanchard; Editing by Robert Birsel)
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