GE Siemens Philips GE Units Under Bribery Probe in China Report

GE, Siemens, Philips Units Under Bribery Probe in China: Report

SHANGHAI -- Chinese regulators are investigating units of foreign medical device companies including General Electric (IW 500/21Siemens (IW 1000/33) and Philips (IW 100/137) for bribery, Bloomberg News reported on Monday.

It was not clear whether full formal investigations would follow the medical device inquiries, Bloomberg News cited sources familiar with the matter as saying, nor did the probes necessarily imply wrongdoing.

The State Administration for Industry & Commerce (SAIC) and other regulators last year opened initial investigations into the companies' Chinese health-care units on suspicion of bribing hospitals in exchange for sales, according to the report.

It is the latest reported example of overseas firms being targeted by Chinese authorities, who have launched wide-ranging probes in sectors ranging from autos to baby milk.

In 2014 a Chinese court found GSK (IW 1000/104) had used bribery to boost sales and took kickbacks from travel agencies to organize conferences that never took place, according to previous reports by state media. The firm was  fined 3.0 billion yuan (US$480 million) last September after a nearly year-long bribery probe.

China's healthcare sector is widely considered to be riddled with graft, partly the result of an opaque tendering system for drugs. Doctors' low salaries are also a factor.

Chinese President Xi Jinping has touted a crackdown on corruption since assuming the Communist Party's top post in 2012, targeting both high-level "tigers" and low-level "flies."

Copyright Agence France-Presse, 2015

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