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China probes Swiss-based packaging giant Tetra Pak

Sunday - 7/7/2013, 12:50pm  ET

BEIJING (AP) -- China's national market regulatory agency says it is investigating possible abuse of market dominance by Switzerland-based food processing and packaging giant Tetra Pak, in a sign that Beijing is widening its scrutiny of operations by foreign companies in China.

Zhang Mao, director of the State Administration for Industry and Commerce, said at a meeting Friday that the agency had enlisted more than 20 provincial and municipal industry and commerce agencies around the country to look into Tetra Pak, according to a transcript of Zhang's speech posted to the administration's website.

Tetra Pak spokesman Christopher Huntley confirmed the investigation and said Saturday that Chinese regulators had requested from the company information related to its China operations. He said the company would cooperate with the government agency, but provided no further information.

Tetra Pak, which formally entered China in 1979, has a research and development center in Shanghai and packaging facilities in four Chinese cities, including Beijing. The company processes and packages liquid dairy products as well as other beverages.

The investigation comes as China looks into possible price-fixing by foreign dairy suppliers and examines drug costs by 60 foreign and domestic companies, a likely prelude to further cuts in government-sent caps on drug prices.

Zhang told the meeting that the administration had launched more investigations against market monopolies and unfair competition. He said the agency investigated 23 monopoly cases, of which 12 resulted in fines.

This past week, China's National Development and Reform Commission, the country's top economic planning agency, began to look into price-fixing by foreign dairy companies, which dominate the Chinese baby formula market because of public distrust in a domestic industry plagued by food safety scandals.

Several foreign companies, including Nestle SA, FrieslandCampina and Wyeth, have announced plans to cut prices.


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