China Arrests Rio Tinto Staffers On Suspicion of Spying

Chinese prosecutors have formally arrested four employees of mining giant Rio Tinto on suspicion of violating commercial secrets and bribery, the official Xinhua news agency reported on Wednesday.

Australian national Stern Hu and three Chinese employees of the Anglo-Australian company -- Liu Caikui, Ge Minqiang, and Wang Yong -- are suspected of 'using improper means to obtain commercial secrets about our country's steel businesses', Xinhua cited prosecutors in Shanghai as saying.

The report said the procuratorate, or state prosecutors, also approved their arrest on suspicion of 'commercial bribery'.

'The procuratoratial organ conducted investigations and believes that it has evidence for suspecting the four, including Stern Hu, of the above crimes,' said the report.

The decision has come in a tumultuous week for Rio in China, a major buyer of its iron ore, and it means Chinese prosecutors are officially weighing whether to bring the four to trial.

It does not amount to an official decision to go trial.

Rio , the world's second-largest iron ore producer, and Anglo-Australian firm BHP Billiton, the third-largest producer, are locked in iron ore price negotiations with China.

Previous reports had suggested the four may be under investigation for violating state secrets, potentially a more serious accusation.

But there was no mention of that crime in this report.

The four were detained a month ago.

Australia's government has not been informed of the arrests, a foreign ministry spokeswoman said.

Rio Tinto had no immediate response to the reported arrests, but it has previously said that the four detained employees did nothing improper.

The company had said on Tuesday it had not been informed of any charges against its detained staff.

The Xinhua report also said that in recent days Chinese steel executives have also been formally arrested on suspicion of 'providing commercial secrets' to Stern Hu.

An online article published in a magazine run by China's state secrets agency at the weekend said Rio spied on Chinese mills for six years, resulting in the mills overpaying $102 billion for iron ore, Rio Tinto's biggest earner.

The Australian government on Tuesday brushed off the Chinese report accusing Rio of overcharging and spying on Chinese steel mills, saying the report had not been officially sanctioned.

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