Foreign firms working in China feel increasingly targeted for “unfair enforcement” of corporate laws and are considering slashing investment in the country in the wake of bribery allegations engulfing GlaxoSmithKline and other international companies.
That’s according to a detailed report by the American Chamber of Commerce in China, which found global firms are facing mounting complaints from Chinese authorities as they investigate foreign car-makers, technology, food firms and drugmakers.
Chinese police arrested senior managers from GlaxoSmithKline’s China business last July amid claims of a Rmb3 billion (£320 million) bribery scandal alleging the drugmaker offered doctors and officials cash and prostitutes to push up prices.
In addition, foreign car firms, including Audi, Daimler and Japanese marques, are being investigated over allegations of breaking antitrust rules. Tech giants Microsoft and Qualcomm are also facing Chinese scrutiny.
Almost half the companies in the research said they believed they were being targeted for “selective and subjective enforcement” of anti-monopoly, food safety and other rules.
Some 60% of firms also said they felt “less welcome” in China, up sharply from a survey late last year, where only 41% reported that sentiment.
