Pressure on Lotte

[Anchor Lead]

The Chinese government has begun applying pressure on Lotte Group's offices in China. The move has drawn speculation that China is retaliating for Lotte’s decision to provide its golf course in Seongju as the site housing the U.S. THAAD missile defense system.

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A team of Chinese tax audit inspectors raided Lotte Group's head Chinese office, located in Shanghai. Such tax probes were also launched against a factory of the Lotte Confectionary Company in Beijing as well as Lotte factories in Chengdu, Shenyang and Weihai. Lotte Mart stores across China are undergoing sudden fire and sanitation inspections. There are around 110 Lotte stores across China. With many of the stores being subjected to such inspections simultaneously this week, Lotte's head office is facing difficulty assessing and dealing with the situation. A Lotte official at the China office said the group had never faced such massive inspections since it launched businesses there. Speculations have emerged that China has taken a retaliatory move in response to Lotte's golf course in Seongju County, Gyeongsangbuk-do Province being selected as the final site to deploy the THAAD missile defense battery. In a briefing, China's Foreign Ministry neither denied nor acknowledged a link between the inspections on Lotte and the THAAD deployment, saying only that there is no change in China's stance against the THAAD system. South Korea's Embassy in China said it will review multilateral measures so that South Korean companies in China will not receive unfair treatment.