'Illegal' Investment Magazine Seized

Chinese authorities target the activities of a disgruntled former investor.

2010-09-21
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Investments and Pitfalls Magazine.jpg The front cover of the first issue of "Investments and Pitfalls" magazine.
Photo appears courtesy of the Hong Kong Coalition for Appeals

HONG KONG—Authorities in the southern Chinese boom town of Shenzhen have confiscated the entire first issue of a recently launched magazine which details the dangers of investing in the mainland, according to the publication's disgruntled co-founder.

Xue Baoren, who has campaigned for the rights of investors in mainland China since a legal dispute with Shenzhen officials over a factory he leased, said the printing operations of Investments and Pitfalls magazine has been moved to his hometown of Hong Kong, where it will be distributed free of charge.

"I had the magazine printed [in May] at a factory in Shenzhen, and then I had planned to have it shipped to Hong Kong," Xue said. "It was supposed to arrive on Aug. 27 but it was confiscated by the authorities in Shenzhen."

Officials from the municipal cultural affairs bureau had declared the magazine an "illegal publication," he said.

"To this day, I haven't had a thing in writing, so I have been pressing them for it, because this is evidence. I can't pursue a complaint in a legal way until they give it to me."

The group of Hong Kong businesspeople who set up the magazine say it is intended as a platform for the airing of grievances against official wrongdoing in China's investment environment. The magazine will also follow up on and expose cases in which nonmainland Chinese investors complain of poor treatment by the authorities.

"It would give us a platform for complaint," Xue said. "We would be able to follow up on cases in our magazine. The government has refused to give us a channel through which to complain, so we'll provide it ourselves."

Co-founder Huang Yijin agreed. "This is a platform for us to speak out," he said.

"It's as if we are saying to China, if you won't give us an explanation, then we'll give you an explanation."

Conference incident

Xue, who said he was searched by customs officials the last time he crossed the border from Hong Kong into neighboring Shenzhen, said he won't be heading back to mainland China for the time being.

He said that Hong Kong journalists had been surprised at a recent news conference he gave in the former British colony, which has an independent judicial system and strong anti-corruption regime, by the addition of two strangers to the press corps who claimed to be reporters from the cutting-edge Apple Daily newspaper.

Challenged by journalists at the news conference, the pair, a man and a woman, backed down and left the scene without giving an explanation.

Xue said he thought the incident was possibly an attempt by a Chinese government agency to find out in a low-profile manner what was going on.

"It's not going to have much of an impact," Xue said. "This sort of thing will get found out very easily because the other journalists will notice very easily."

"The way they see it, they are doing the right thing. They want to check the background of people who have [negative] opinions about the government. We won't stop them. Everything I do is in the open; everything they do is secret. So there's not much to be done about it."

An employee who answered the phone at the Apple Daily newspaper in Hong Kong Monday said the paper had no comment to make on the incident.

Lease terminated

Xue began his career as a China businessman in 2000 by leasing a food-processing plant from a state-owned enterprise. His lease was terminated in 2008 by local officials after he turned the plant around and started to make a profit.

Xue pursued the authorities through the courts for the losses incurred by the early termination of his lease, winning 300,000 yuan (U.S. $45,000) in compensation. But he was dissatisfied with the amount, and staged a silent sit-in outside the Shenzhen Intermediate People's Court that lasted nearly six months.

He then moved his protest to Hong Kong after he was warned by police that he risked detention if he continued.

Investments and Pitfalls
will initially be published in Hong Kong, followed by Taiwan and the United States. Publicity material says the magazine hopes to promote the rule of law in China and protect the rights of citizens.

Ethnic Chinese investors in China who aren't mainland nationals have complained that they are afforded scant legal protection if they run into disputes with powerful players over their investment activities.

In 2001, Australian Chinese businesswoman Ma Ping, whose company invested billions of yuan in the northern port city of Tianjin, complained of several months of physical abuse and illegal detention in the city after she refused to go along with "unofficial" paperwork in connection with a multimillion yuan bank deposit she wished to withdraw.

And in 1993, Australian Chinese businessman James Peng was jailed for six years and deprived of his controlling stake in a China-listed real estate, textile, and trading firm by authorities in Shenzhen. Peng's claim was upheld by a Hong Kong court in 2004, which ordered the niece of late supreme leader Deng Xiaoping to pay back U.S. $100 million of assets to Peng.

Original reporting in Cantonese by Lin Jing and in Mandarin by Xin Yu. Translated and written in English by Luisetta Mudie.

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