This chapter moves beyond individual corporations and corporate types to examine the broader sociopolitical system in China. It focuses on the "fragmented authoritarianism" of the Chinese government and the Chinese Communist Party (CCP), outlining the main causes of fragmentation, including corruption, factionalism, autonomy of state-owned enterprises, local government self-interest, private firm co-optation of government actors, and internal contradictions within the CCP's own ideology. This fragmentation prevents the CCP from exercising consistent control over corporations and the broader society, leading to a much more complex and diverse corporate-political ecosystem than imagined by many Western commentators.

This chapter analyzes the major problem of corporate-political corruption in more detail, using case studies of Bo Xilai and the Shide Group ("white gloves"), Zhou Yongkang and CNPC ("protection umbrellas"), and Zhao Zhengyong in Shaanxi Province ("predatory corruption" and "symbiotic parasitism") to illustrate the key types of collusive corruption between officials and corporations and their harmful impacts on Chinese society and politics. At the same time, the chapter introduces the case of Shenzhen's gray property market to show that sometimes a degree of symbiotic corruption is necessary to overcome inflexible and outdated regulations in a rapidly developing economy.

Do China’s data localisation laws, which were introduced as part of China’s Network Sovereignty policy, adversely affect – or are they likely to adversely affect – open innovation in Chinese AI firms, which is a key goal of China’s Internet Plus policy?