China ‘gravely concerned’ over EU raids on security equipment company

China has expressed “grave concern” over raids carried out by European officials on a Chinese company that manufactures security equipment.

EU competition regulators on Tuesday raided offices of Chinese company Nuctech in the Netherlands and Poland as part of a probe into unfair state subsidies.

In a statement on Thursday, China’s mission to the EU said it deplored the “unannounced inspections” and criticised Brussels for not raising its concerns with the company or Chinese authorities directly.

“The Chinese side believes that the EU’s unannounced inspections interferes with the order of fair competition in the market, clearly jeopardises the positive atmosphere of trade and economic cooperation between China and the EU, and strikes a strong shock to the confidence and sense of security of all foreign companies in the EU, including Chinese ones,” the mission said.

“It also highlights the further deterioration of the EU’s business environment and sends an extremely negative signal to all foreign companies operating in the EU. Protectionism cannot bring prosperity, and suppressing others will only weaken competitiveness of one’s own.”

The EU should “abide by its commitment to open market and the principles of a level playing field, and stop using all kinds of excuses to unreasonably suppress and impede the Chinese companies,” the mission added, expressing hopes for cooperation and exchanges in an “open, fair and equitable way”.

The remarks come after the China Chamber of Commerce to the EU (CCCEU) on Wednesday expressed “serious concern” over the raids.

“The European side manifested its intention to weaponise the Foreign Subsidies Regulation as a tool to suppress lawfully operating Chinese companies in Europe,” the chamber said in a statement.

“The CCCEU expresses its strong dissatisfaction with the European side’s raids on companies set up by Chinese enterprise in the EU without prior notice and without solid evidence.”

Nuctech, which manufactures scanning equipment for airports and border crossings, has said it is cooperating with authorities and committed to “defending its reputation of a fully independent and self-supporting economic operator”.

The European Commission said it carried out the raids as a “preliminary investigative step” after receiving indications that an unnamed company may have received foreign subsidies that could distort the market.

The raids were the first such action taken by the commission since it adopted the Foreign Subsidies Regulation in July last year amid concerns about market distortions caused by foreign subsidies.