China Launches Investigation into Apple Supplier Foxconn Over Tax and Land Use
China has launched an investigation into Apple iPhone maker Foxconn over tax and land use, according to Chinese state media. The investigation includes inspections of Foxconn’s sites in the provinces of Guangdong, Jiangsu, Henan, and Hubei. Foxconn has stated that it will cooperate with the investigation, emphasizing its commitment to complying with laws and regulations. In response to the news, an expert quoted in the Global Times article urged Taiwan-funded enterprises, including Foxconn, to assume social responsibilities and play a positive role in promoting peaceful cross-strait relations.
The investigation into Foxconn comes at a crucial time as the company’s founder, Terry Gou, is running as an independent candidate in Taiwan’s presidential elections in January. The outcome of the elections will have a significant impact on Taiwan’s relationship with China and tensions in the Taiwan Strait. Gou, who resigned from Foxconn’s board after announcing his presidential run, still retains a 12.5% stake in the company.
This is not the first time that China has targeted Taiwanese companies at sensitive or tense moments. Chinese officials often urge Taiwanese companies to help promote “peaceful development” between the two sides. China claims Taiwan as its territory and maintains the option of using force for unification if Taipei resists. The People’s Liberation Army has been increasing its probes of Taiwan’s airspace and waters.
Despite Foxconn’s close ties with China, Gou insists that he is not doing China’s bidding. He stated that if the Chinese Communist Party were to threaten to confiscate Foxconn’s assets, he would welcome it and refuse to comply with their orders.
The investigation into Foxconn also reflects the broader uncertainty among foreign businesses in China following Beijing’s crackdown on consultancy operations. This is further highlighted by the recent raid on the Shanghai offices of WPP-owned media agency GroupM by Chinese police.
In addition to the investigation, Apple is also navigating a complex relationship with China amid historic tensions between Beijing and Washington. Apple CEO Tim Cook recently traveled to China and met with members of Xi Jinping’s leadership team to discuss issues related to commerce and information technology.
The investigation into Foxconn and the challenges faced by Apple underscore the complexities that foreign businesses encounter when operating in China. As the political and economic landscape continues to evolve, companies must carefully navigate these challenges to maintain their operations and relationships in the country.