French intelligence warns of Chinese espionage
China used honeytraps and spying interns in industrial espionage, according to leaked French intelligence files.
One report claimed a top researcher in a major French pharmaceutical company was wined and dined by a Chinese girl and ended up in bed with her.
“When he was shown the recorded film of the previous night in his hotel room . . . he proved highly co-operative,” said an economic intelligence official.
In another case, an unnamed French company realized too late that a sample of its patented liquid had left the building after the visit of a Chinese delegation. One of the visitors had dipped his tie into the liquid to take home a sample and copy it.
Companies should do more to protect themselves from prying eyes among the 30,000 Chinese students who conduct internships in France, experts warned.
Among the most frequent methods cited by French intelligence is the so-called “lamprey technique”, which usually takes the form of an international tender for business. “The aim of the project is to attract responses from developed countries,” notes the report. When Western companies vie to respond, they are cajoled and “told to improve their technical offering”.
“Each (company) tries to outdo the other, once, twice, several times until the Chinese consider they’ve had enough.” Once key information has been gathered, the bidders are told the project has been shelved and the information is used by the Chinese to develop its own products.
A prime example was a recent multi-billion dollar tender to build China’s high-speed train. France’s TGV was a bidder. As part of the process, the French embassy in Beijing organized a six-month training course for Chinese engineers. Soon afterwards China brought out its own high-speed train remarkably similar to the TGV and Germany’s ICE train.
Another technique is the “mushroom factory”, in which French industries create a joint venture with a local Chinese firm and transfer part of their technology. Later local rivals emerge, “offer identical products and are run by the Chinese head of the company that initiated the joint venture”. A third technique is to turn the tables on a foreign firm by accusing it of counterfeiting. Schneider Electric was taken to court over a hook in its fuse box, which it patented in 1996. Its Chinese rival Chint started building the same hook, took Schneider to court in China for copying its design and Schneider was ordered to pay a $49.5 million.
Renault, the French carmaker is embroiled in an espionage scandal involving three top executives over allegations they were paid to hand over car secrets to a Chinese firm.