Chinese prosecutors have formally arrested four employees of Anglo-Australian mining giant Rio Tinto on suspicion of obtaining commercial secrets and bribery, the official Xinhua news agency reported today.
Australian Stern Hu and three Chinese staff of the world's second-biggest iron ore producer are suspected of “using improper means to obtain commercial secrets about our country's steel businesses”, Xinhua cited prosecutors in Shanghai as saying.
The commercial secrets charge can bring jail terms of up to 3 years, or 7 years in “especially serious” cases. The procuratorate, or prosecutors, also approved their arrest on suspicion of "commercial bribery", said the Xinhua report.
Xinhua did not mention accusations of stealing state secrets, a sweeping charge raised in earlier reports, which can attract tougher sentences.
“The procuratoratial organ conducted investigations and believes that it has evidence for suspecting the four, including Stern Hu, of the above crimes,” said the Xinhua report.
Mr Hu and the three other members of Rio Tinto's Shanghai-based iron ore marketing team - Liu Caikui, Ge Minqiang and Wang Yong - were detained on July 5th. Hu, a Chinese-born Australian citizen and head of the team, was accused of obtaining the Chinese steel industry's negotiating stance in iron ore price talks, sources have said. Iron ore is used to make steel.
The Rio case has cast a shadow over Australia-China trade, worth $53 billion in two-way terms in 2008. But China's sidelining, for now, of the graver state secrets accusations may indicate an effort to cool political contention over the matter.
“That lowers the temperature,” said Jerome Cohen, an expert on Chinese law at New York University, speaking of the absence of the state secrets accusations.
“That puts this as a white collar crime, a commercial crime, and not espionage involving state secrets.”
Chinese Vice Minister of Commerce, Fu Ziying, told a news conference in Beijing the case would receive a "fair verdict" - a term suggesting a trial is certain - and said it showed his government wanted to create a fair and open marketplace.
“I believe this case will not, and should not, affect the healthy and stable development of Chinese-Australian bilateral trade and economic relations,” he said.
Mr Cohen said that without the state secrets accusations, which authorities can use to justify keeping suspects entirely isolated, the Rio suspects stand a stronger chance of being allowed to see lawyers.
Reuters