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World Business Quick Take

■ Espionage
Chinese probed in the US
US prosecutors will interview 12 Chinese citizens in an industrial espionage case involving Lucent Technologies Inc after Beijing said for the first time US authorities could question witnesses in China, the Financial Times said, citing a US attorney involved in the case. The two-year old case focuses on two former Lucent employees accused of conspiring to steal computer technology and sell it in China, the paper said. None of the witnesses are in custody or have been charged under Chinese law. All but one of the witnesses are employees of Datang Telecom Technology Co, while the 12th works for ComTriad in China, the paper said, citing Scott Christie, the assistant US attorney prosecuting the case. The ComTriad employee is accused of using the company to pass stolen secrets to Datang.

■ Telecoms
Telstra net profits plunge
Australia's largest telecommunications operator, Telstra Corp, reported a 43 percent plunge in first-half net profits to A$1.184 billion (US$710 million) because of a massive writedown on a Hong-Kong cable asset. Telstra said yesterday that before the US$965-million writedown for its Reach Ltd cable undersea joint venture with Hong Kong-based Pacific Century CyberWorks Ltd, net profit was down 4.1 percent. The group said underlying sales revenue was down 0.1 percent to US$10.195 billion for the six months to the end of December. Telstra chief executive Ziggy Switkowski forecast underlying revenue to remain flat in the second half and 2003 full-year earnings before interest and tax would also be flat. More than a billion dollars was wiped off the group's value in a share plummet after Telstra announced last week that it would write off its 50-percent stake in Reach, valuing the investment at zero.

■ Kmart
Former executives charged
Two former Kmart Corp vice-presidents were indicted on US charges they overstated revenue in the first criminal case stemming from the retailer's bankruptcy. Enio Montini, 51, and Joseph Hofmeister, 52, were accused of lying about a payment from American Greetings Corp so Kmart could book US$42.3 million in revenue in the second quarter of 2001. Accounting rules required the money to be recorded over time, prosecutors and the Securities and Exchange Commission said. Government officials said their investigation was continuing beyond the two executives, who were charged with securities fraud and lying to the SEC. Former Chief Executive Officer Charles Conaway has been accused by Kmart of misleading the board in the months before the retailer ran out of money in 2001.

■ Internet
France votes to ban spam
France's National Assembly on Monday voted in favor of banning unsolicited e-mail sales messages, known as spam. The move, presented to the lower house of parliament in the form of government amendments to a law to "increase confidence in the digital economy," was approved by deputies at a first reading. Direct electronic marketing without prior consent would be allowed, under the new law, in certain circumstances, where the parties involved were properly registered so as not to penalise e-business between companies. The law now goes up to the upper house, the Senate, for its approval.
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