China to investigate FedEx after Huawei mix-up

Chinese authorities will investigate United States delivery company FedEx over harming the interests of its clients, state media reported on Saturday.

FedEx earlier this week apologised for misrouting some Huawei parcels after the Chinese telecom giant said it was reviewing its ties with the package service over the incident.

“Related Chinese government departments announced on June 1 that because US FedEx did not deliver to the right addresses in China, severely hurting the legal rights and interests of its customers […] (China) will immediately open an investigation,” state broadcaster CCTV said in a news article.

“As a courier company operating in China for decades, FedEx has the obligation to cooperate with the investigations of relevant Chinese authorities,” CCTV said.

China has already established a system of “unreliable” entities, CCTV noted, adding the investigation will be “a warning to other foreign companies”.

China’s commerce ministry on Friday announced it would release its own list of “unreliable entities” that break their commercial contracts and stop supplying Chinese firms.

A Chinese expert writing in state media on Saturday said the new list will function like the US entity list and ban Chinese companies from selling or cooperating with listed firms.

The FedEx mix-up came as Huawei faces US moves to blacklist the company, cutting it off from American-made components it needs for its products, though a 90-day reprieve was issued.

FedEx said on Tuesday that “no external parties requested that FedEx transfer these packages”.