Beijing, China (CNN) -- China has freed three Japanese nationals who were being investigated for entering a military zone without authorization and videotaping military targets, Chinese state media said Thursday.
Another Japanese national, who worked with the three, remained under house arrest as an investigation continued, China Daily said.
The company that employs the four Japanese nationals said Thursday that it was working to confirm the release.
The four were arrested as Beijing and Tokyo clashed over the arrest of a Chinese fishing captain by Japan.
The captain was taken into custody in early September off the disputed Diaoyu Islands in the East China Sea. His arrest touched off a battle that escalated into diplomatic threats by Beijing, the suspension of diplomatic talks and canceled trips between the nations.
Japan has since freed the fishing captain, but the two countries have continued the diplomatic battle. Both nations have demanded compensation over the captain's arrest. China says he was arrested illegally and wants damages for his damaged fishing boat. Japan said he damaged two Japanese patrol boats and has demanded compensation as well.
No further details were immediately released Thursday about the four Japanese nationals or a Chinese co-worker who went missing at the same time as the arrests. The Chinese national was presumed arrested as well.
All five worked for Fujita Corp., a mid-size Japanese construction company. The four Japanese employees were sent to China for a Japanese government project to reclaim World War II chemical weapons left by Japan's Imperial Army, Fujita said.
Goldman Sachs Group acquired Fujita in April 2009.
Beijing says the Diaoyu Islands and most of the South China Sea belong to China, disputing neighboring countries' claims. In Japan, the islands are known as the Senkaku. The clash over territorial waters and islands -- and the natural resources that go with them -- is a flash point in the Asia-Pacific region.
CNN's Junko Ogura contributed to this report.