By Helena Smolak and Mauro Orru


BASF is accelerating the process to sell its interest in two joint ventures in China's north-western Xinjiang region, citing allegations that its partner is involved in the repression of ethnic Uyghurs.

The move follows an investigation by German media outlets Der Spiegel and ZDF, which claimed to have found employees of BASF's partner, Xinjiang Markor Chemical Industry, accompanying Chinese officials on visits to surveil and indoctrinate Uyghurs--a Turkic ethnic group--to benefit the Chinese government.

The German chemicals giant said Friday that there was no indication that employees of the two joint ventures, located in Korla, were involved in alleged human-rights violations. The company said it doesn't have a stake in Xinjiang Markor Chemical Industry itself.

However, BASF said the recently-published reports contained what it called serious allegations that indicate activities inconsistent with company values, and had decided to speed up the divestment process that began in the last three months of last year.

The Chinese company didn't respond to a request for comment outside of Chinese business hours. China's Embassy in Germany didn't respond to a request for comment.

The United Nations human-rights agency said in a 2022 report that China's government may have committed crimes against humanity in its treatment of ethnic Uyghurs and other Muslim minorities in Xinjiang.

The U.S. and other Western governments have criticized Beijing for human-rights abuses in Xinjiang, where the Chinese government has rounded up Uyghurs and other predominantly Muslim minorities into a regionwide network of internment camps. China has repeatedly denied perpetrating human rights abuses in Xinjiang.

BASF is one of many western companies to reassess its operations in China over human-rights allegations amid increasing scrutiny over their supply chains in Xinjiang.

In 2021, Sweden's Hennes & Mauritz's H&M was wiped off China's main e-commerce, ride-hailing, daily-deals and map applications, after the clothing brand's decision to stop sourcing from China's Xinjiang region.

Chinese social-media users have also turned their ire on other international brands, including Nike and Adidas, which had issued similar statements about forced-labor concerns in Xinjiang.

The Inter-Parliamentary Alliance on China, a coalition of developed-world lawmakers, urged BASF to withdraw from the region in a letter dated Monday.

BASF said the process to sell its shares in the two joint ventures, BASF Markor Chemical Manufacturing (Xinjiang) and Markor Meiou Chemical (Xinjiang), is subject to negotiations and required approvals from relevant authorities.

However, the company said it was committed to preserving its operations in China. The country accounts for about half of global chemical production.


Write to Helena Smolak at helena.smolak@wsj.com and Mauro Orru at mauro.orru@wsj.com


(END) Dow Jones Newswires

02-09-24 1105ET