China has formally arrested four employees of Anglo-Australian mining giant Rio Tinto Ltd on charges of infringing trade secrets and bribery, allegations less dire than earlier accusations of espionage in Chinese state media.
Xinhua news agency said yesterday that investigations showed the four employees, including Australian citizen Stern Hu (胡士泰), had obtained commercial secrets about China's steel and iron industries through “improper means” and were involved in bribery.
The report made no mention of the more serious accusations of stealing state secrets, which Chinese media have been saying the four would face.
Rio Tinto's iron ore chief executive Sam Walsh told reporters yesterday that the company believed its employees were innocent. The Australian government urged Beijing to let Hu consult with a lawyer.
“The charges have been downgraded and I think that reflects what we've been saying all along, that we don't, in fact, believe there's any evidence of wrongdoing,” Walsh was quoted as saying on the ABC Web site.
Hu, the chief of Rio Tinto's Chinese iron ore business, and three Chinese nationals working for the miner were originally detained on July 5 amid contentious ore price talks with Chinese steel mills.
The case has further strained relations with Australia, a key supplier of iron ore and other resources for China's fast-growing economy, after Rio Tinto's decision in June to drop a US$19.5 billion deal with the state-controlled Aluminum Corp of China (中國鋁業).
Chinalco, as the Chinese company is better known, later subscribed to a US$15.2 billion share issue to maintain a 9 percent stake in Rio Tinto.
News of the arrests was also reported yesterday on the Web site of the China Procuratorial Daily, which is run by the Supreme People's Procuratorate — China's top prosecutorial organ.
Xinhua said Chinese prosecutors had found evidence of bribery. It said some individuals in Chinese steel and iron companies were suspected of providing the Rio employees with commercial secrets, though no specific details were given.
The Australian foreign affairs department was informed about the arrests and charges late on Tuesday by China's Ministry of Public Security.
“We encourage China to allow Mr Hu all the protections available under Chinese law, including access to legal representation, now that he has been formally arrested,” the department said in a statement.
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