China: Microsoft, auto probes revive foreign relations anxieties

China’s ongoing crackdown of foreign auto makers, combined with reports of dawn raids of Microsoft offices in the nation, are reviving anxieties that China is using antimonopoly regulation to favor domestic companies over their foreign counterparts.

Reports emerged last week that China’s State Administration for Industry and Commerce launched a second round of searches into Microsoft offices in several major cities. The investigations are also said to extend to Microsoft financial services provider Accenture.

The searches coincide with the National Development and Reform Commission’s broadening investigation into foreign car makers; officials said last Wednesday it plans to punish Volkswagen’s Audi, Fiat’s Chrysler and possibly others for anticompetitive practices.

In recent weeks Mercedes-Benz decided to cut prices on certain products in the nation because of the investigations. Toyota and Honda also announced similar plans to follow suit.

Together, the investigations demonstrate China’s growing use of its six-year-old antimonopoly law, say reports. Some experts are concerned that the nation’s recent strengthening of it competition regulation has unfairly hit foreign companies more than China’s own entities, suggesting that China may be unfairly disciplining new market entrants, according to reports. Last April, the US Chamber of Commerce asked Secretary of State John Kerry and Treasury Secretary Jacob Lew to tighten its grip against China because of these emerging patterns against foreign companies.

Full content: Reuters

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