Chinese official warns foreigners against using lawyers

Xu Xinyu, a divisional head at China's National Development and Reform Commission (NDRC) has warned foreign firms - including GE, Samsung and Microsoft - against using lawyers if they are subject to antitrust investigations.

NDRC head's antitrust warnings seen as 'threatening' by participants Videowokart

The NDRC has been a leading agency in China's recent clampdown on some foreign firms. The warning took place on 24-25 July in a Beijing hotel at what was billed as a training session for multiinationals on the People's Republic's 2008 anti-monopoly law. The official showed in-house lawyers present how to write confessions of guilt - and showed examples from previous cases. 

Guilt admission

Two sources gave a detailed run-down on the meeting to Reuters, and said that other companies present included Volvo, IBM Corp, Michelin, Tetra Pak, Intel and Arris. Relating to the warning against hiring outside lawyers, Reuters comments: 'The two sources said Xu did not explain why he didn't want foreign firms to hire external lawyers if they were probed. Getting an admission of guilt from companies makes it easier for the NDRC because lawyers who have dealt with it said its capacity for legal analysis was weak and that few within its antitrust bureau had a background in law.'

Power of NDRC

The comments of Mr Xu were seen as 'threatening' by participants. Daniel Sokol, law professor at the University of Florida, told Reuters: 'The problem is that because it [NDRC] has so much power and because in various forums they have been focusing on foreign enforcement, this is definitely impacting business decision-making about further FDI into China.'

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