Global Courant
Shares of Apple suppliers fell as much as 3 percent after a report from Chinese state-owned Global Times.
Shares of Taiwan’s Foxconn, a major supplier of Apple’s iPhones, fell as much as 3 percent on Monday after a report that the company is the subject of tax audits and land-use investigations in China just months ahead of Taiwan’s elections.
China’s state-backed Global Times said some of Foxconn’s key subsidiaries in China were the subject of tax audits and that China’s natural resources department had also conducted on-the-spot investigations into Foxconn companies’ land use in Henan and Hubei and elsewhere.
The Global Times did not provide details about the tax or land use investigations, which have not been officially announced by any Chinese government department.
Foxconn said in a statement on Sunday that compliance with the legislation was a “fundamental principle” of its activities everywhere and that it would “actively cooperate with the relevant units in related work and operations”.
The company declined further comment on Monday. Foxconn, formally called Hon Hai Precision Industry Co Ltd, makes most of its iPhones at its Zhengzhou factory in Henan province, which employs about 200,000 people, although it also has other smaller production sites in India and southern China.
The Chinese state media report comes less than three months before Taiwan’s presidential and parliamentary election votes.
Terry Gou, the billionaire founder of Foxconn who no longer plays a role in the company’s day-to-day operations and stepped down as company chief in 2019, is running as an independent candidate even though he is at the bottom of the polls.
He has accused Taiwan’s ruling Democratic Progressive Party (DPP) of bringing the island to the brink of war with China through its hostile policies, saying that only he, with his extensive business and personal contacts in China and the United States, can maintain peace.
Gou’s campaign spokesman Huang Shih-hsiu referred questions about the Foxconn investigation to the company, saying Gou had handed over control of the company four years ago, was no longer on the board and was now just a shareholder.
At a campaign rally on Sunday, Taiwanese Vice President Lai Ching-te, the DPP presidential candidate leading the polls, said China’s report on the investigation was “unexpected” and “deplorable.”
“So I hope all our people can support Hon Hai, support Taiwanese companies,” he said in comments carried by Taiwanese television stations.
