Rio Tinto trial opens in Shanghai
Australia says trial on charges of bribery and theft of secrets will be closely watched.
Last Modified: 22 Mar 2010 08:39 GMT
China has said that parts of the trial on stealing trade secrets will be held behind closed doors [Reuters]

Australia has warned China that the trial of four mining executives will be watched "very closely" by the outside world as the highly sensitive case gets underway in a Shanghai court.

Australian Stern Hu and three Chinese employees of Anglo-Australian mining giant Rio Tinto have been charged with bribery and stealing commercial secrets, in a case that has strained diplomatic ties and put the Chinese system in the spotlight.

Their trial began on Monday in Shanghai's No 1 Intermediate People's Court and is expected to last three days.

Hu, Rio's senior executive in China in charge of iron ore, and his colleagues have been in custody since July.

The men face up to seven years in jail if convicted on charges of commercial espionage and found to have caused extreme damage, and five years or longer in jail if found guilty of bribery.

Rio Tinto has said the four men did nothing wrong.

'Great concern'

On Monday the company's chief executive, Tom Albanese, was in Beijing for a forum on China's place in the world economy.

Rio Tinto executives on trial

 Australian Stern Hu and Chinese executives Liu Caikui, Ge Minqiang and Wang Yong accused of bribery and theft of commercial secrets.

 If convicted they could face up to seven years jail on the commercial secrets charges and possibly up to 20 years for bribery.

ustralian officials have been told they will be barred from hearings related to theft of commercial secrets.

 The case has raised investor worries about doing business in China's murky legal environment.

 Australia has warned China that major economic interests could be affected by the case.

In prepared comments on the case, he said Rio Tinto was "respectfully" awaiting the outcome.

"This issue is obviously of great concern to us, as it would be for any company operating in China. I can only say we respectfully await the outcome of the Chinese legal process," he said.

China has insisted the case will be handled by the book and it will "fully guarantee" the rights of the defendants.

However Kevin Rudd, the Australian prime minister, told reporters on Monday that his government will be "monitoring the trial very carefully".

"China has a different legal system to Australia, China has a different legal system to the rest of the world.

"The world will be watching very closely," Rudd said, repeating comments last week.

Greg Sheridan, the foreign editor of The Australian newspaper, said he viewed the trial as a political move by China.

In video

Greg Sheridan tells Al Jazeera why the Rio
trial has put China in the spotlight

"There is no reason to think that there is any substance to any of these charges," he told Al Jazeera from Melbourne.

"These are clearly political charges, which is an attempt by China to intimidate Australia, in which it has been largely successful."

Reporters outside the court said some journalists, mostly from Chinese state media, were allowed in to cover Monday's opening session.

However, China has said the hearings on the industrial secrets charges will be held behind closed doors, raising questions from Australian officials over whether the men will get a fair trial.

Australia has said its consular officials will attend trial sessions on the bribe-taking charges and it had asked China to reconsider the closure of the trade secrets hearings.

In a statement issue over the weekend, the Australian Department of Foreign Affairs and Trade said it was disappointed with the Chinese decision to bar access to some parts of trial.


"The Government's disappointment with the decision has been registered with Chinese officials in Beijing and Canberra," it said.

"The Australian Government does not propose to make further representations on this matter."

Rio Tinto has said its employees
did nothing wrong [AFP]

The department said Hu's lawyer, Duan Qihua, will be present throughout the trial.

The four defendants were arrested last July during contentious iron ore contract negotiations which later collapsed, and after Rio snubbed a near $20bn cash injection from state-run Chinese mining firm Chinalco.

Rio Tinto, based in London and Australia, is the world's third-largest mining company and one of China's biggest suppliers of Iron ore, one of the main ingredients for making steel.

At the time of the executives' arrests Rio was acting as lead negotiator for global iron ore suppliers in price talks with Chinese steel mills.

The case comes at a time of friction with the US over China's currency policies and doubts among some in the foreign business community over Beijing's commitment to building an open and fair business environment.

Joerg Wuttke, the president of the European Union Chamber of Commerce in China, told the AFP new agency the trial was being seen as a barometer of legal transparency in China.

"It will be regarded as a litmus test of the status of the young Chinese legal system," he said.

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