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China probes Tetra Pak under market dominance

BEIJING (AP) -- China's national market regulatory agency said that it is investigating possible abuse of market dominance by the food processing and packaging giant Tetra Pak, in a sign that Beijing is widening its scrutiny of operations by foreign companies in China.

Zhang Mao, director of the State Administration for Industry and Commerce, said at a Friday meeting that the agency had enlisted more than 20 provincial and municipal industry and commerce agencies around the country to look into Tetra Pak, according to a transcript of Zhang's speech posted to the administration's web site.

Comments from Tetra Pak were not immediately available. Tetra Tak formally entered China in 1979, and it has a research and development center in Shanghai with packaging facilities in four cities, including Beijing. The company processes and packages liquid dairy products as well as other beverages.

The investigation comes as China looks into possible price-fixing by foreign dairy suppliers and examines drug costs by 60 foreign and domestic companies, a likely prelude to further cuts in government-sent caps on drug prices.

Zhang told the meeting that the administration had launched more investigations against market monopolies and unfair competition. He said the agency investigated 23 monopoly cases, of which 12 resulted in fines.

This week, China's top economic planning agency — the National Development and Reform Commission — began to look into price-fixing by foreign dairy companies, which dominate the China's baby formula market because of public distrust in the domestic industry plagued with food safety scandals.

Several foreign companies, including Nestle SA, FrieslandCampina and Wyeth, have announced plans to cut prices.