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Germany's Daimler confirms China car probe after raid report

China's probes into foreign firms spread to the auto sector Tuesday (Aug 5) as German car giant Daimler said it was assisting authorities, after reports a Shanghai office of its Mercedes-Benz unit was raided. 

SHANGHAI: China's probes into foreign firms spread to the auto sector Tuesday (Aug 5) as German car giant Daimler said it was assisting authorities, after reports a Shanghai office of its Mercedes-Benz unit was raided. "We confirm that we are assisting the authorities in their investigation," Daimler Greater China said in an email to AFP.

It is the first confirmation of an official inquiry into a foreign automaker in China, the world's largest car market, after authorities targeted overseas firms in several different sectors over the past year.

A team of nine anti-monopoly investigators from China's National Development and Reform Commission (NDRC) paid a surprise visit to a Mercedes-Benz premises in Shanghai on Monday, grilled employees and "forcibly" checked computers, reported Jiemian, a new media platform of state-run Shanghai United Media Group.

It quoted an unnamed source saying that the investigation focused on "Benz's prices of finished automobiles and its policy of maintaining minimum prices with distributors".

The NDRC is one of several Chinese government bodies which investigates violations of the country's "anti-monopoly" law. It is responsible for doing so from a pricing perspective.

The Mercedes-Benz office, in a western suburb of Shanghai, includes a dealership with a showroom and a service centre. Several showroom employees told AFP they were unaware of any investigation. But a security guard said the premises were visited by an investigation team for two days in a row. "They were here all day yesterday and three or four hours this morning," he said.

A sign outside says it is an authorised dealer of Mercedes-Benz China and the Beijing Benz Automotive Co - a joint venture between Daimler and Chinese partner BAIC Motor, which has been producing Mercedes-Benz passenger cars since 2006.

Since last year, China has launched sweeping probes into alleged wrongdoings by foreign companies in several sectors, including the pharmaceutical and baby milk powder industries. Last week, a Chinese government agency said it was investigating US software giant Microsoft for allegedly operating a monopoly in its market.

The State Administration for Industry and Commerce (SAIC), which also enforces the anti-monopoly law, said that probe centres on Microsoft's Windows operating system - which is used on the vast majority of computers in China - and the Office suite of programs.

State media have said China is planning to announce US chip maker Qualcomm has monopoly status in the mobile phone chip market. And last year, China fined six baby formula producers - all but one of them foreign - a total of US$108 million for price-fixing. 

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