According to FBI Director Christopher Wray, China is now requiring U.S. and other foreign-owned companies to host groups that monitor their compliance with Chinese Communist Party orthodoxy. This is a tactic used by the Chinese government to obtain companies’ secrets and information through joint business ventures. Wray emphasized that no country poses a greater threat to ideas, innovation, and economic security than the Chinese government and the Chinese Communist Party. His remarks highlight the tension between Beijing and Washington. Wray acknowledges that this issue deserves more attention, as CEOs fear speaking out against the Chinese government. He also emphasized that if similar practices were implemented in American or British companies, people would strongly oppose them. Wray did not provide specific examples of companies housing CCP cells in China, nor did he directly address concerns about the increase in their usage. The U.S. Chamber of Commerce and Business Roundtable have not yet commented on Wray’s remarks. Sayari, a commercial risk intelligence platform, warned in a 2021 report that private companies in China face mounting pressure to grant more influence to CCP cells. Since 2018, companies have been required to establish CCP cells in order to be listed on domestic stock exchanges. China has long mandated such internal party committees, but enforcements intensified after 2012.
Additionally, new regulations implemented last year mandated securities investment funds in China to establish these internal party committees. The Chinese securities regulator stated that these rules align with corporate governance principles and Chinese law, and there are no concerns about data security. HSBC reportedly became the first foreign lender to install a CCP committee in its banking business in China. It’s not the first time Wray has expressed concerns about Beijing’s attempts to enforce communist political views within foreign companies operating in China.
The exchange between Wray and Rep. Lance Gooden brought some relief to the otherwise hostile questions Wray faced from the Republican majority of the House Judiciary Committee. Wray faced inquiries about the FBI’s potential political bias against conservatives.
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