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SCMP Reporter

A CHINESE company belonging to Hong Kong's oldest hong, Jardine Matheson, has been forced by mainland officials to close more than half of its mainland offices in a licensing dispute.

The plight of Jardine Transport Services (China) - JTSC - comes just four months after Jardine Matheson Group directors met Beijing officials to heal a traditionally-frosty relationship recently soured by the company's alleged support for Governor ChrisPatten.

Jardines sources said restructuring plans were being drawn up for JTSC, after officials in eight cities across China - including Beijing - had told the company its licence allowed only one office in each city.

JTSC, a private offshoot of Jardine Pacific - Jardines' trading arm - handles sea and air cargo from 19 offices in Beijing, Shanghai, Guangzhou, Qingdao, Nanjing, Dalian, Hangzhou and Tianjin.

Most of the offices were set up in 1991, yet company officials were told late last year they must amalgamate to fulfil licensing requirements.

Dozens of workers now face redundancy.

Jardine Pacific director Stanley Ko last night confirmed the reshuffle and possible redundancies, but denied any Chinese intervention or licence problem.

''This is totally a business decision,'' he said.

''We're not retrenching or facing licensing problems, and how many offices we have is entirely up to us.

''This is a process of improving our efficiency through economies of scale and final plans have not yet been worked out,'' Mr Ko said.

Mr Ko refused to say whether JTSC or JTS (Hong Kong) were posting profits, saying it was a ''commercial secret''.

The China bureaus of another Jardine Pacific subsidiary, Jardine Shipping Agencies, have not been affected, and shipping industry sources said other locally-based freight firms, including Wallem Shipping, were continuing to expand unhindered along the China coast.

Jardine Pacific managing director Anthony Nightingale said he was unable to comment on any Chinese involvement in the reshuffle, saying he had been away from the territory for several weeks.

Jardine Matheson - 100 per cent owners of Jardine Pacific - has traditionally taken a more political line than its counterpart Swire.

The policy came to a head last December, when Beijing accused the company of voicing support of Mr Patten's moves to introduce greater democracy to Hong Kong.

At the time, Beijing was reported to have banned the group from conducting any new business on the mainland, in remarks subsequently toned down.



China dispute forces Jardines offshoot to close offices