The government of Yunnan Province said it initiated an investigation into Coca-Cola for illegally mapping part of the province using electronic devices, media reports said.
According to yunnan.cn, a news portal run by the Publicity Department of the Communist Party of China Yunnan Provincial Committee, the local mapping agency began investigating Coca-Cola last year and discovered the company used handheld GPS devices to illegally collect information it was not entitled to.
The investigation was one of 21 major cases handled by the Yunnan Geographical Informa¬tion Bureau of Surveying and Mapping last year, the bureau reported at a work conference in late February.
The report didn't provide additional details on the type of GPS device or the region that Coca-Cola employees were believed to have entered.
In an email statement to the Global Times, Coca-Cola said that all logistics measures it has undertaken were legal.
"These include e-map and location-based customer logistics systems that are commercially available in China through authorized local suppliers," the company wrote.
There is no mention of the investigation on the bureau's website and phone calls to the bureau's mapping and administrative offices went unanswered.
The soft drinks giant said the company had "cooperated fully" with Yunnan govern¬ment's enquiries and is "in full compliance" with current regulations.
An expert with the China Academy of Space Technology told the Global Times that national security could be harmed if someone enters a restricted area with a handheld GPS devise. He refused to disclose his name, saying mapping is a sensitive issue.
"Some regions could be sensitive because of their military importance," the expert said. "If an unauthorized person or organization accurately mapped the area and used the result for political purposes, it could jeopardize our nation."
Coca-Cola, however, said it only used e-mapping technologies to run its business more efficiently.
"Over the last several years, some of our local bottling plants in China have adopted logistics solutions to improve customer service levels and fuel efficiency," the statement said.
Another expert, who used to work with the China Association of Global Positioning Technology Applications, said only professionals holding certificates issued by the National Administration of Surveying, Mapping and Geo-information are legally entitled to map an area.
"Sometimes even licensed engineers are not allowed to map some regions," she said. "Mapping is an extremely sensitive issue."
The Coca-Cola investigation is yet another incident in the on-going "war of words" between China and the US over the use of digital technology. On Tuesday, foreign ministry spokeswoman Hua Chunying said that China hopes to create a "peaceful, safe, open and co-operative" cyberspace with the help of other countries, in response to a speech by a top US official saying that cyber attacks from China are posing a growing risk to economic relations.