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Foxconn calls for confidence after China tax probe

Taiwan-based tech giant Foxconn said Monday its current operations were “normal”, calling for confidence in the company after a tax probe launched by Chinese authorities.

One of the world’s largest contract electronics makers and a key producer of Apple’s iPhones, Foxconn is under tax and land investigations in several Chinese provinces, Beijing’s state-run Global Times publication said earlier this month.

The report did not specify what exactly regulators were looking into, nor did it mention any specific offenses that Foxconn may have committed.

In a statement issued Monday, Foxconn said there was now significant speculation about its operations that “affects capital market activity”.

The company’s management “continues to communicate and discuss with external counterparts our position and ongoing operating conditions”, it added.

“Operations are normal presently. We urge everyone to have confidence in the Group and to refrain from spreading rumors.”

Last week, the company said it would cooperate with the relevant authorities in their probing of “operations concerned”, but did not provide further details.

The investigations come as self-ruled Taiwan—which Beijing claims as its territory and has vowed to seize one day—prepares to hold presidential elections in January.

Officials from Taiwan’s ruling Democratic Progressive Party (DPP) have defended Foxconn and accused Beijing of trying to interfere in its elections.

Vice President Lai Ching-te, who is now running for president, has warned that Taiwanese companies based in China may be forced to relocate if they feel “unjustly pressured”. He also urged Beijing to refrain from supporting specific candidates in the elections.

Foxconn, also known as Hon Hai Precision Industry, is China’s largest private-sector employer, with more than a million workers nationwide.

Its billionaire founder Terry Gou—who handed over the management reins four years ago—is currently running as a long-shot independent candidate in the Taiwanese presidential election.

The other presidential candidates are Hou Yu-ih of the main opposition Kuomintang party and Ko Wen-je from the smaller Taiwan People’s Party, with both in favor of friendlier ties with Beijing. Tech Xplore

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