Chinese Law Prof Blog

Editor: Donald C. Clarke
George Washington University Law School

Wednesday, July 8, 2009

Australia's Rio Tinto employees detained in Shanghai

The use of state power to back up one side in commercial disputes is not uncommon in China. In what may be another example (too soon to tell), the Financial Times reports that four employees of Rio Tinto, currently in bad odor in China for reasons explained in the article (as well as being in the middle of tough negotiations with Chinese iron ore buyers), were detained in Shanghai without explanation. Subsequent information is that at least one employee will be charged with espionage and theft of state secrets.

This is pretty serious. Typically in commercial disputes, the criminal charge is one of fraud or something similar, whereas espionage and state secrets charges are used in political cases (as they probably are, of course, where actual espionage and state secrets are involved - but overuse breeds skepticism). Here, however, we have a company involved in tense commercial negotiations and these very serious charges against employees - it's unusual.

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Who but senior members of the Standing Committee of the Politburo could have approved the order to so act?

Likely, in addition to policy considerations, he/they was/were to profit substantially from the transaction. This smacks of more than simple administrative action: its radical nature apparently derives from a personal rage. That is my guesstimate, at any rate.

And as we all know, vengeance is mine saith the Lord(s).

Rich Kuslan, Editor

Posted by: Richard Kuslan, Editor, Asiabizblog | Jul 21, 2009 11:07:55 AM

This happened because the law in Shanghai is different than in other countries, and when going there you should know the basics to stay out of trouble.

Posted by: shanghailawyer | Sep 24, 2009 12:03:28 PM

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