European companies slam Chinese antitrust probes

Tom Mitchell
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European companies have lashed out at the Chinese government's renewed crackdown on alleged violations of the country's anti-monopoly law, saying that they have been subject to "intimidation tactics" by officials who have unfairly targeted foreign businesses.

In a rare public backlash, on Wednesday the Beijing-based European Chamber of Commerce in China issued what it described as a "consolidated stance" from member companies that had been targeted by antitrust investigations during the past year.

"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," the group said.

Read MoreHow firms learn to live with China antitrust raids

It added that Chinese authorities had warned companies "not to challenge the investigations, bring lawyers to hearings or involve their respective governments or chambers of commerce".

Last summer, China's National Development and Reform Commission fined multinational baby powder manufacturers for alleged pricing violations. While the companies involved all accepted the NDRC's findings, privately many foreign executives and lawyers argue that high prices in China are often a function of market demand, high import tariffs and other factors.

The NDRC struck again last month when it raided the Shanghai offices of Daimler, the German company that manufactures Mercedes-Benz sedans, and said it would punish Audi for allegedly overcharging dealers and repair shops for spare parts. US technology companies such as Qualcomm and Microsoft have also confirmed that they are the subject of competition investigations by Chinese authorities.

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NDRC officials could not be immediately reached for comment. They have previously insisted that their investigations have snared both domestic and foreign companies, and denies targeting the latter group.

Daimler, Audi and BMW, which together account for about 80 per cent of luxury car sales in the world's largest automotive market, have since said they would cut spare parts prices in China.

Read MoreChina regulator says Microsoft should not obstruct anti-trustprobe

All three companies produce cars in China with local partners – in accordance with local laws that prohibit foreign car companies from holding majority stakes in manufacturing operations.

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In its statement on Wednesday, the European Chamber expressed concern that "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 also noted that in some industries, domestic companies had apparently been spared official scrutiny.

Read MoreChina anti-trust regulator conducts new raids on Microsoft,Accenture

Earlier this week, Audi's China division said it would respect any administrative punishments handed down by the NDRC, while General Motors of the US confirmed that it was assisting Chinese authorities in their investigation of the Chinese auto sector.

Jaguar Land Rover, which is preparing to begin manufacturing operations in China this year, has also moved to cut the prices of its imported luxury SUVs.