China’s antitrust crackdown threatens a more hostile climate for Western businesses

China's antitrust crackdown threatens to end the era when products from Audi saloons to Starbucks lattes generated fatter profits in Beijing than in London or New York.

In the past month, antitrust authorities have pressured at least seven carmakers to cut prices. Officials raided the offices of software maker Microsoft, Qualcomm, Caterpillar, Mead Johnson Nutrition and Danone among other foreign businesses have fallen under anti-monopoly scrutiny since last year.

The probes, combined with signs that the central government is shunning some US technology companies for security reasons, have left foreign businesses struggling to figure out the evolving laws and regulations in the world's most populous country. Those that try to adapt must interpret vague rules in an economy that's no longer as reliant on foreign investment as in past decades.

"We may be seeing a paradigm shift where the rules of the game are changing," said David Loevinger, former US Treasury Department senior coordinator for China affairs and now an analyst at TCW Group. "Until people figure out the new rules it will create a much more uncertain business climate."

Car companies - Audi, BMW, Mercedes-Benz, Jaguar Land Rover, Chrysler, Toyota and Honda - have announced price cuts on vehicles or spare parts since last month after the National Development and Reform Commission (NDRC) began investigating more than a dozen car manufacturers.