Chinese experts on Friday said the decision to investigate units of South Korea's Lotte Group in China was a legitimate regulatory action, and that it was not related to the company's involvement in the deployment of a U.S. missile defense system.
A representative at Lotte China headquarters in Shanghai confirmed with the Global Times on Friday that several subsidiaries of the company have been investigated by Chinese authorities for tax, fire control and safety issues.
The representative, who requested anonymity, said they are still gathering information from these subsidiaries and that the company attaches great importance to Chinese laws and safety regulations.
But the representative refrained from commenting further on the investigation or if the company has been in contact with the South Korean government.
South Korea's Yonhap News Agency reported Friday that the South Korean government is considering to express regret over China's probes into Lotte because "the action may be in retaliation to" the planned deployment of the Terminal High Altitude Area Defense (THAAD) system.
Lotte has signed a deal with the South Korean government to provide a golf course in Southeast South Korea for the THAAD deployment, according to Yonhap.
Experts said the South Korean government and Lotte may have misread and complicated the investigations.
"They are connecting dots that are not really related here," Lü Chao, a research fellow with the Liaoning Academy of Social Sciences, told the Global Times. He said though it is obvious that Lotte's involvement in the THAAD issue raised concerns among some Chinese, the probes are "legitimate and are common" to foreign companies operating in the Chinese market.
The Chinese government's authority to oversee and investigate any foreign company operating in China in accordance with law is indisputable, said Gao Liankui, an expert from the Department of Economics with the Renmin University of China.
However, the accusation that China is punishing a private firm for political disputes is "unreasonable," Lü said, noting China has "many more ways" to express its opposition to the THAAD issue, including through diplomatic and military channels.
"China has genuine concerns over the deployment of THAAD system, and South Korea should rethink its decision before further damaging bilateral relations. Meanwhile, China should take appropriate counter measures," Lü said.
DPRK responds to sanctions
DPRK's leader Kim Jong-un on Friday observed a huge artillery drill and threatened to "make a clean sweep" of South Korea if war broke out, in an apparent response to fresh sanctions on his country.
The military drill carried out by DPRK front-line units reportedly simulated hitting targets in South Korea, Yonhap reported. Kim Jong-un said "nobody and nothing" could survive such military strikes, which, if inflicted on South Korean forces, could "completely break their will of counteraction at the start and make a clean sweep of them."
South Korea on Friday announced new unilateral sanctions against DPRK, which includes adding 35 entities and 36 individuals to a blacklist, according to a separate Yonhap report.
South Korea included a Chinese firm and four executives of the company to its sanction list, the first time Chinese entities are targeted by South Korean sanctions, Yonhap said.