Microsoft Corporation (NASDAQ:MSFT) is currently the focus of an investigation by the State Administration for Industry and Commerce in China. Officials raided the company’s offices in four different Chinese cities last week. Approximately 100 investigators from the agency took part in the raids.
Microsoft offices raided
The Wall Street Journal reports that investigators from the SAIC said they also questioned Microsoft Deputy General Counsel Mary Snapp. Regulators accuse the company of not disclosing important information regarding some of its security features and how its software products are tied together. They told Microsoft not to interfere in or obstruct their investigation, although the SAIC said that so far, the company is cooperating.
Microsoft has said that it complies with Chinese law, although spokespeople for the company have refused to comment on the investigation. China has said it is investigating many technology companies, reports CNET. Its state-run media has reported that officials believe at least some companies based in the U.S. are spying on China’s government. Since Microsoft is one of the most high profile tech companies, it’s really no surprise that investigators in China are looking into its practices. They have already banned Windows 8 from government computers and disrupted Microsoft’s OneDrive cloud storage service.
China targets U.S.-based companies
Chinese officials have become increasingly suspicious about U.S.-based companies, particularly after the National Security Agency’s digital spying programs were revealed. The Chinese military, for its part, has also been reported to be hacking networks in the U.S. for the purpose of spying on the U.S.
Executives at a number of technology companies have indicated that their businesses have been hurt by the growing suspicions about companies based in the U.S. Officials in China have been investigating QUALCOMM, Inc. (NASDAQ:QCOM) since November regarding its calculations of patent licensing and royalty rates. The semiconductor maker manufacturer said earlier this year that it could face fines and post losses on its China business because of those fines. Qualcomm also said Chinese regulators’ probe of its operations in the country has increased uncertainty.