China steps up investigation of foreign firms

China has cranked up its antitrust investigation into Microsoft, saying the software giant should not obstruct an investigation by Chinese regulators, the State Administration for Industry and Commerce has said.

Meanwhile, German carmaker Daimler's luxury brand Mercedes-Benz said it was co-operating with China's anti-monopoly authorities over an investigation into unspecified matters, after Chinese media reported the company's Shanghai office had been raided.

Recent months have seen a raft of inquiries into international firms by Chinese regulators, including Starbucks, GlaxoSmithKline, Apple, McDonald’s and New Zealand dairy giant Fonterra.

While the Beijing government says the crackdowns on foreign firms are aimed at stopping abuses, critics allege China is using anti-trust and other investigations to protect and bolster domestic firms.

Raided offices

Since launching an official investigation into Microsoft last week, the administration has grilled Microsoft's lawyer Mary Snapp and raided four of the software firm's offices in China.

“Microsoft promised to respect Chinese law and fully co-operate with the SAIC’s investigation work,” the SAIC said in an emailed statement. Microsoft said last week its “business practices are designed to be compliant with Chinese law”.

In May, China banned government use of Microsoft’s latest operating system, Windows 8, after the software giant ended support for the widely used Windows XP as part of efforts to introduce more secure and less easily pirated versions of Windows.

Surprise visit

Separately, local media reported that nine officials from the anti-monopoly National Development and Reform Commission’s antitrust investigation team sprang a surprise visit to Mercedes-Benz’s Shanghai office on yesterday, interviewing senior executives and confiscating computers.

Mercedes-Benz confirmed in a statement today that it was helping with an investigation. China is intensifying efforts to bring companies into compliance with an anti-monopoly law enacted in 2008.

Mercedes-Benz is the latest foreign company to be targeted by Chinese regulators. Regulators officially named US chipmaker Qualcomm a monopoly last month and are widely expected to levy a heavy fine.