Coca-Cola Investigation Highlights Challenges to Companies Operating in China


The Coca-Cola Co. is facing allegations of spying in China tied to its use of GPS-mapping technology. The dispute highlights the many challenges faced by U.S. companies operating in China, where the laws often differ dramatically from our own.

The Yunnan Geographical Information Bureau of Surveying and Mapping has alleged that Coca Cola has been "illegally collecting classified information with handheld GPS equipment” in a rural province. Although details of the investigation have not been released, the deputy director of the bureau told China National Radio that companies and individuals are profiting from collecting information and selling it to foreign intelligence agencies. “Mapping information can be used by enemies. So it must be restricted,” he stated.

Meanwhile, the beverage company maintains that it is cooperating with Chinese officials and that its activities were entirely business related. Coca Cola told The New York Times that local bottling plants use "e-map and location-based customer logistics systems that are commercially available in China" to improve efficiency. “These customer logistics systems are broadly used for commercial application across many industries in China and worldwide,” the company added.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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