China fines Bombardier and local firm for joint venture

Image copyrightAFP

Image captionBombardier had been in talks with a Chinese train maker since November last year

Chinese officials have fined Canadian train maker Bombardier and a local unit of train giant CRRC for setting up a joint venture without government approval.

Bombardier and CSR Nanjing Puzhen have both been fined 150,000 yuan ($23,572; £15,578) each, according to the ministry of commerce.

The companies had violated China's anti-monopoly law, it said.

The firms had planned to make trains for Chinese cities and airports.

They had each agreed to invest 125m yuan to set up the joint venture in November last year, but only notified the government of the deal in December.

Marc Laforge, a Bombardier spokesman, told Reuters that the regulatory notification was introduced while the company and its Chinese counterpart were already involved in negotiations over the joint venture.

"At the end of the day, we're very satisfied that our joint venture was approved," he said.

CSR Nanjing Puzhen is a unit of state-owned firm CSR Corporation. The parent company merged with rival train maker China CNR to create CRRC, the world's biggest train maker, this year.

The merger of the state-backed firms was done in part to compete with the likes of Bombardier, and Germany's Siemens for global projects.