"The media reports have quite a lot of errors and they seem to be making people think badly of Japan," said an official of the company, based in Osaka Prefecture. "We were not involved in systematic prostitute-buying."
The president of the company issued a public apology late Monday but denied that his company organized the trip to buy sex.
"The trip was organized to commend employees as part of a company campaign. It was not intended as a prostitution tour as reported," the statement said.
The president offered his "profound apologies" for the public uproar in China.
According to Chinese media reports, a Japanese tour group invited about 500 hostesses and went "prostitute shopping" at the International Conference Center Hotel in Zhuhai for an orgy that took place in the evening of Sept 17.
Police in southern China's Guangdong Province are reportedly investigating the case.
The Osaka construction company said 288 people, most of them company employees, took part in a company trip to Zhuhai on Sept 16 and stayed two nights at the International Conference Center Hotel.
On the first night, the company said it invited about 200 hostesses to a commendation party held at a separate hotel in Zhuhai.
After the party, all of the employees returned to the International Conference Center Hotel by bus and then had free time after that, the Osaka construction company official said.
"Perhaps some of the employees may have done something like that in their free time. That may have led to a misunderstanding," the official said.
According to the Beijing Youth Daily, 380 male tourists arranged to meet the prostitutes through a staff member in the International Conference Center Hotel's Japanese marketing department, paying 1,200 yuan (about $145) to each woman.
Some 500 prostitutes later crowded the public areas of the hotel in full view of other guests, and an orgy-style party ensued that continued past midnight, the newspaper said.
A 100-strong Chinese group attending a conference was among the hotel's guests, and one Chinese guest overheard the Japanese tourists talking about unusual sex acts, the report said.
The People's Daily newspaper noted that the mass orgy happened on the eve of the 72nd anniversary of the Manchurian incident marking the start of Japan's invasion of northeastern China.
Local police are "paying great attention" to this case, the paper said. The hotel has been closed for "rectification," and the police are investigating with an eye toward punishing anyone who allowed the "debauchery," the report added.
Meanwhile, the China Youth Daily reported Sunday that the provincial Public Security Bureau on Saturday took into custody several Chinese people suspected of involvement in organized prostitution.
Zhang Dejiang, the top leader of the province and secretary of the Guangdong Provincial Committee of the Chinese Communist Party, on Friday ordered a thorough investigation into the facts and circumstances surrounding the incident.
Following the launch of the investigation, the head of the provincial Public Security Bureau arrived on the scene and seized video footage from security cameras installed at the hotel.
"As soon as we have a result, we'll definitely approach the provincial foreign affairs department with a report," a Zhuhai police officer told Kyodo News by telephone Sunday.
A staff member of the five-star, 530-room high-rise hotel confirmed that all hotel services had stopped. She would not say when the hotel might reopen and said no hotel representative could comment about the night of Sept 17.
The Japanese Embassy claimed it had not heard of the incident as of Sunday, an embassy source said. But he said that because so many Japanese groups visit China, it would be hard for the embassy to keep track of the activities of each one.
"There are many, many meetings like that. I don't know of this particular case," he said. "But our economic trade and private sector relations are so huge, it's growing, so we don't know who is coming here and where they're meeting."
The hotel "lost face" for China and bears blame if it organized the orgy, said Zhu Sihao, a Beijing university student who follows Sino-Japanese relations. "If these were 400 Chinese people, there would still be a moral problem."
"Hearing about this is very troubling. They just wanted to make as much money as possible. It's a matter of race relations," he added. (Kyodo News)
Thats why they work so damn hard... they want the company trips