Rio Tinto Execs Sentence In China Trial

A Chinese court sentenced a foreign executive to 10 years in prison for his role in bribery and breaking China's commercial secrets law. The Australian foreign minister called the sentence against the executive of the mining giant Rio Tinto unusually harsh, but other experts said it was in line with Chinese policy.

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From NPR News, this is ALL THINGS CONSIDERED. I'm Noah Adams.

Ten years - that's the sentence handed down today for Australian Stern Hu. He is one of four employees of the Rio Tinto Mining Company put on trial in China, accused of taking bribes and stealing commercial secrets. All four were found guilty today and received sentences of between seven and 14 years.

Parts of the trial were disclosed to the public, and that, coupled with what it considers a harsh sentence for Hu, has angered the Australian government.

NPR's Louisa Lim was in the court and sent this report.

LOUISA LIM: Stern, who stood impassive in a dark sports jacket, showing no visible reaction as he was told he'd spend a decade in a Chinese jail. The Australian had been working for the mining giant Rio Tinto when he was arrested last July with three Chinese colleagues. He was found guilty of taking more than $900,000 of bribes and stealing commercial secrets. This was the reaction of Australian foreign minister Stephen Smith.

Mr. STEPHEN SMITH (Minister for Foreign Affairs, Australia): This, to me, seems to be a very harsh sentence. And on the commercial secrets matter, because we've had no access to that part of the trial, there are, I think, serious unanswered questions, which the international business community will want to continue to pursue with China.

LIM: One of those serious unanswered questions is the fact that part of the trial was held in closed court without even consular representation. Donald Clarke, a Chinese law specialist at George Washington University, says this does not follow the letter of the law.

Professor DONALD CLARKE (Chinese Law, George Washington University): The agreement on consular relations between China and Australia specifically provides that trials of Australian nationals shall be accessible to Australian diplomats, and China simply brushed off this obligation by saying that Chinese domestic law overrides Chinese international obligations, which is pretty shocking.

LIM: Regarding the theft of commercial secrets, the court heard the man had obtained information from two strategy meetings of the China Iron and Steel Association, which negotiates the Chinese dealmakers. Among other things, they discovered information about a reduction in production by one Chinese steel mill. Although the exact details remain unclear, some in the industry, like Philip Kirchlechner, are questioning whether the men really stole trade secrets. He did the exact same job as Stern Hu for Rio Tinto in Shanghai in the late '90s and now is a consultant for mining companies.

Mr. PHILIP KIRCHLECHNER (Consultant): I think in other countries, that would be considered commercial intelligence, not a secret. I think that is normal business intelligence, which is necessary for future planning, and I think in other jurisdictions that would not constitute a secret.

LIM: But the court heard the men's actions have cost Chinese steelmakers $150 million last year alone. Some do not believe the sentences were overly harsh, like Steve Dickinson, a lawyer in China for Harris & Moure law firm.

Mr. STEVE DICKINSON (Lawyer, Harris & Moure): Those sentences are totally within the normal range of sentences for that kind of crime in China. I mean, bribery in the $900,000 range is a huge crime in China. That's 400 times the average annual wage of people who live in Beijing. It's a big crime.

LIM: It's not yet clear whether the four will appeal their sentences. What is clear is that this judgment is sending a message to other foreign companies: China is no longer a place where anything goes. It's time to clean up or face the consequences.

And this case reminds foreign companies that given China's opaque legal system, the consequences are something to be feared.

Louisa Lim, NPR News, Shanghai.

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