“The national security authorities have investigated several special cases and found that many overseas organisations with complex backgrounds have stolen China’s national secrets and intelligence in key areas through domestic consulting firms and other industries. Some domestic consulting companies have a weak sense of national security, and in order to gain economic benefits, they frequently walk on the edge of the law.
The EU is one of China’s biggest trading partners and sources of foreign investment. On Tuesday its ambassador to China said the crackdown on consultancies was “not good news”. The ambassador, Jorge Toledo Albinana, also said the expansion of the anti-espionage law could allow for actions which were “not very conducive” to China’s stated aims of further opening its economy to the global market and foreign investment.
Business consultancy and due diligence firms have long operated in China to provide research and background information to foreign companies wanting to do business in the country. But the raids, which come at the same time as a, have sparked concern among foreign business operators in the country. Japanese firms in particular have expressed fears about continuing to work in China, with at least 17 nationals detained under the anti-espionage law since 2014.
The targeted firms have not responded to media queries, beyond a statement from Bain & Co last month saying it was cooperating with police. Capvision posted on its WeChat account that it would “firmly implement national security development”.