China’s Ministry of Commerce has denied that its refusal to approve Coca-Cola’s acquisition of the Huiyuan Juice Group was based on protectionism. In a question-and-answer session their spokesman, Yao Jian, defended the Ministry’s decision by saying that it was made with “sufficient investigation and research, on the basis of facts, and strictly in line with the country’s anti-monopoly law”.
Yao Jian said that the government would continue to encourage foreign investment and still hoped to create a “favourable investment environment”. Yao Jian was keen to point out that “products of the Coca-Cola Company are available anywhere in China’s Market. The country’s market is fully open to foreign companies”. The reason for the rejection was that in this instance it was felt that the proposed deal would “seriously cripple or deprive other fruit juice producers of the ability to compete”.
Coca-Cola and Huiyuan have both come forward to say that they respect the Ministry’s decision.