Danone fiasco underlines China business risks

0 Comments | AFP, June, 2007

BEIJING (AFP) — Rogue companies. Secret profits. Legal threats. Allegations of "evil deeds" and "tyranny."

It may sound like an overwrought corporate thriller, but all are elements in a dispute between French firm Danone and its Chinese partner which has underlined the lingering risks of doing business in China.

The case has seen a successful Sino-foreign joint venture devolve into a catfight of charges and recriminations. For many, it's a cautionary tale about getting into bed with a Chinese partner.

"In my mind, there is no reason to have a (Chinese) partner anymore," said Mic Mittasch, an Australian who was involved in joint ventures but now runs a wholly foreign-owned business here creating production lines for manufacturing firms.

"A lot of...