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From PyroJames at GameFAQS.com:
The term “CQC” stands for “Close Quarter Combat” and is used to describe an up-close military hand-to-hand fighting system. Originally a combination of martial arts and short-range weapon play (such as knives, batons and firearms), the basis of CQC was devised in Asia but now, is used to describe a wide range of mixed martial arts commonly implemented into military training used in different countries throughout the world. CQC is also known as “Trench Warfare” as the up-close fighting system was suitable for tight environments such as military trenches.
Originally taught by the Shanghai Municipal Police Force as a self-defense technique for their law enforcement officers, the idea of CQC was to approach and combat your opponent with confidence at a very close range which would restrict the amount of “attack space” the hostile individual had. As a result, the opponent would in a way, be caught off guard and his ability to counter-attack at full strength and potential would be impeded. This would greatly assist the police officers in disarming and restraining an attacker while their optional baton and sidearm would provide self-protection and lethal stopping power if necessary.