(Yicai) Oct. 23 -- Hon Han Precision Industry, better known as Foxconn, said legal compliance is one of its primary principles after a report said several of the Apple supplier’s units in the Chinese mainland were inspected by tax and natural resources authorities.

“Legal compliance everywhere we operate around the world is a fundamental principle,” the Taiwan-based company said in a statement today. “We will actively cooperate with the relevant units on the related work and operations.”

China’s State Taxation Administration recently inspected Foxconn units in Guangdong and Jiangsu provinces, among other places, in accordance with the law, Global Times reported yesterday. The Ministry of Natural Resources has also investigated the land-use rights of units in Henan and Hubei provinces, the report said.

Foxconn Industrial Internet, the company’s Shanghai-listed unit, is cooperating with the tax authorities and its operations are unaffected, National Business Daily cited it as saying today.

Shares of Foxconn Industrial [SHA: 601138] plunged by the 10 percent daily trading limit to CNY14.55 (USD1.99) apiece today, while Taipei-listed Foxconn Technology [TPE: 2354] fell 2.2 percent to close at TWD53.50 (USD1.65).

Corporate tax and land use inspections are normal market supervision activities, which are reasonable and legal, Zhang Wensheng, deputy dean of the Taiwan Research Institute at Xiamen University, told Global Times. Foxconn's subsidiaries must cooperate, maintain market order, and be ready to correct their mistakes if any violations are found, he said.

Foxconn is the world’s largest contract electronics manufacturer and is well know for its role in assembling a wide range of products, particularly Apple's iPhones and iPads. The firm, which opened its first plant in the Chinese mainland in 1988, has more than 40 production bases in the country and had one million employees at its peak.

In 2018, Foxconn acquired several commercial and residential plots of land in Guangzhou with cash-strapped developer Country Garden Holdings.

Foxconn Industrial’s revenue fell 8.2 percent to CNY206.8 billion (USD28.3 billion) in the first half from a year earlier, while profit rose 4.2 percent to CNY7.2 billion (USD1 billion).

Editor: Martin Kadiev