Current:Home > BackAs China raids U.S. businesses and arrests workers, the corporate landscape is getting "very risky"-LoTradeCoin
As China raids U.S. businesses and arrests workers, the corporate landscape is getting "very risky"
View Date:2024-12-23 23:59:22
The risks of doing business in China are increasing for foreign companies. The offices of Capvision, a consulting firm with offices in New York and Shanghai, and two American firms have been raided in recent weeks as Chinese authorities exercise their power under a new security law.
Police showed up out of the blue in early May at the Chinese offices of Capvision, searched the premises and questioned employees.
- Navy releases video of U.S. destroyer's close call with Chinese warship
Earlier this spring, U.S. firms Bain & Company and the Mintz Group also had their Chinese offices raided. Five of Mintz's Chinese employees were detained.
All three companies did business gathering information on Chinese companies for U.S. investors.
After the Capvision raid, Chinese state TV even aired a special report alleging, without presenting any hard evidence, that the company had lured Chinese citizens to spill state secrets.
Capvision kept its response to the raid low-key, saying on social media that it would "review its practices," with direction from China's security authorities.
But James Zimmerman, a business lawyer who works in Beijing, told CBS News the raids have spooked foreign businesses.
"Everything's a threat, you know," Zimmerman said. "Unfortunately, in that kind of environment it's very difficult to operate — when everything is viewed as a national security matter and… it looks as if…. anything you do could be considered to be spying."
- China calls U.S. concern over spying cargo cranes "paranoid"
The billionaire boss of Twitter and Tesla, Elon Musk, was lionized when he visited China last week. He had a meeting with China's top vice premier and got a rapturous welcome from employees at his Tesla facility in Shanghai.
He and other big players in China, including the bosses of American giants like Apple and Starbucks, may be untouchable, but smaller businesses are worried.
"A lot of folks are starting to, you know, rewrite their strategic plans just because of the tension," said Zimmerman, noting that the increasing crackdown by Chinese authorities "makes it politically very risky for them."
Paradoxically, China recently launched a campaign to attract new business from overseas. But many investors have cold feet. A new counterespionage law is due to take effect on July 1, and they worry it may be used as a political weapon to punish certain firms by redefining legitimate due diligence as spying.
- In:
- Tesla
- Small Business
- Xi Jinping
- Elon Musk
- Spying
- China
- Beijing
Elizabeth Palmer has been a CBS News correspondent since August 2000. She has been based in London since late 2003, after having been based in Moscow (2000-03). Palmer reports primarily for the "CBS Evening News."
veryGood! (63)
Related
- Parts of Southern California under quarantine over oriental fruit fly infestation
- Check Out the Best Men's Deals at the Nordstrom Anniversary Sale on Clothing, Grooming, Shoes & More
- 10,000 red drum to be stocked in Calcasieu Lake estuary as part of pilot program
- Michael K. Williams' nephew urges compassion for defendant at sentencing related to actor's death
- Quincy Jones' cause of death revealed: Reports
- 'Shame on us': Broncos coach Sean Payton rips NFL for gambling policy after latest ban
- Anchorage mayor wants to give homeless people a one-way ticket to warm climates before Alaska winter
- Ex-Oregon prison nurse convicted of sexually assaulting 9 women in custody
- Sister Wives’ Christine Brown Shares Glimpse Into Honeymoon One Year After Marrying David Woolley
- Education Department investigating Harvard's legacy admission policies
Ranking
- Taking stock of bonds: Does the 60/40 rule still have a role in retirement savings?
- Kansas football lineman charged in connection with alleged bomb threat
- Colorado businessman gets over 5 years in prison for ‘We Build The Wall’ fundraiser fraud
- Gen Z progressives hope to use Supreme Court's student loan, affirmative action decisions to mobilize young voters
- Skai Jackson announces pregnancy with first child: 'My heart is so full!'
- Chris Eubanks finds newfound fame after Wimbledon run. Can he stay hot ahead of US Open?
- Decades in prison for 3 sentenced in North Dakota fentanyl trafficking probe
- Pamela Blair, 'All My Children' and 'A Chorus Line' actress, dies at 73
Recommendation
-
Watch a rescuer’s cat-like reflexes pluck a kitten from mid-air after a scary fall
-
'Go time:' Packers QB Jordan Love poised to emerge from Aaron Rodgers' shadow
-
Child labor laws violated at McDonald's locations in Texas, Louisiana, Department of Labor finds
-
Man suspected of shooting and injuring Dallas-area doctor was then shot and injured by police
-
Falling scaffolding plank narrowly misses pedestrians at Boston’s South Station
-
Google rebounds from unprecedented drop in ad revenue with a resurgence that pushes stock higher
-
Stock market today: Asian markets are mixed ahead of what traders hope will be a final Fed rate hike
-
Michael Jackson sexual abuse lawsuits on verge of revival by appeals court