Australian Rio Tinto executive Stern Hu has been sentenced to 10 years by a Chinese court after being found guilty of accepting bribes and stealing trade secrets.
Australian Rio Tinto executive Stern Hu has been sentenced to 10 years by a Chinese court after being found guilty of accepting bribes and stealing trade secrets.
The Shanghai court also revealed for the first time that Mr Hu and three of his colleagues had stolen the minutes of a China Iron and Steel Association meeting.
It marks the first time that details on the trade secrets charges had been publicly revealed. Last week's three-day hearing was held behind closed doors.
The four defendants appeared today before the court in civilian clothing, with Mr Hu wearing a blue wind-breaker. His normally black hair was white.
Mr Hu and three Rio Tinto Chinese staff were convicted of accepting bribes totalling around $US13 million ($A14.3 million) and stealing trade secrets.
Mr Hu, the head of the Anglo-Australian miner's Shanghai office, was sentenced to 10 years in prison. His Chinese colleagues Wang Yong, Ge Minqiang and Liu Caikui were given jail terms of 14, eight and seven years, respectively.
Mr Hu also was fined 500,000 yuan and had another 500,000 yuan worth of personal assets confiscated, the court said.
Mr Hu's lawyer Jin Chunqing told The Associated Press by telephone that an appeal had not yet been decided.
"We haven't decided yet if we would appeal to the higher court or what we should do for the next step, as we need to meet and discuss with Stern face to face, and as soon as possible," Jin said.
Australian Prime Minister Kevin Rudd has said the world is watching the trial, which has been widely seen as a test of the rule of law in China and has sparked concerns about doing business in the world's third-largest economy.
Three decades after China opened up to the world, US and European businesses are now complaining of increasingly onerous rules, preferential treatment for local firms and growing nationalism.
The four had pleaded guilty to taking money, and one had admitted to commercial espionage, but the accused had disputed aspects of the charges, their lawyers said.
A prosecutor had recommended that Hu be given a lenient sentence after he apologised to the court and to Rio, saying he took more than $900,000 to help childhood friends in need, his lawyer Jin Chunqing said.
The four Rio employees were arrested last July during contentious iron-ore contract talks between top mining companies and the steel industry in China, the world's largest consumer of the raw material. The talks collapsed.
A posting outside the Shanghai courthouse said Tan Yixin, an executive at China's eighth-largest steel mill Shougang Corp. who was detained last year after the Rio arrests, would appear in court at 3:00 pm (0700 GMT).
The notice gave no further details about the hearing.
At the three-day trial of the Rio employees, the court heard evidence that millions of yuan in bribes had been stuffed into bags and boxes for the accused, according to state media.
Hu took money from small private steel companies, which before the global financial crisis were locked out of buying iron ore from Rio because the mining giant prioritised large state-run steel companies, Jin said.
When the global economic crisis hit in September 2008, demand for iron ore plummeted and the smaller players paid bribes "to squeeze into the club and join the buyers", he said.
Wang strongly objected to the bribery allegations, saying he simply borrowed the money from one of China's richest men, Du Shuanghua, the National Business Daily said.
Du, the former head of Shandong-based Rizhao Iron & Steel group, has contradicted Wang's account, saying he paid the Rio employee nine million dollars for preferential treatment, the newspaper said.
Australian Foreign Minister Stephen Smith chastised China last week for locking the country's diplomats out of the courtroom during the hearings on the commercial espionage allegations.
China appeared to have broken its own laws by excluding Australia's consular staff from the hearings, according to New York University professor Jerome Cohen, a leading US expert on Chinese legal issues.
The decision "to exclude the Australian consuls violated existing Chinese law, which since 1995 has explicitly instructed China's courts to permit foreign consular representation even at non-public trials", Cohen wrote in an article co-authored with Yu-Jie Chen, a fellow at the US Asia Law Institute.
"There had been an expectation that the Chinese legal system was becoming more transparent and accountable," said Ann Kent, a visiting fellow at the Australian National University College of Law.
"On the evidence to date, this trial has not met these expectations."
Foreign Minister Stephen Smith said this afternoon that the 10-year penalty give to Mr Hu was a "tough sentence".
He added that there was "substantial" evidence that Mr Hu was guilty of bribery.
"Australian officials ... has access to this part of the trial and the advice I have is that in addition to Stern Hu's own admissions there was other evidence which drew Australian officials to the conclusion that acts of bribery had occurred."
Mr Smith then addressed the second charge of stealing commercial secrets for which Hu was fined about $75,000 and sentenced to five years prison.
"This, of course, was, very regrettably, a part of the trial to which Australian officials did not have access," he said.
"As a consequence of that I think there are various unanswered questions which go to that part of the trial and go to that matter as far as Stern Hu is concerned."
Mr Smith said these concerns spread more widely to Australian business.
"China has missed a substantial opportunity. This was an opportunity for China to bring some clarity to the notion or the question of commercial secrets," he said.
Mr Smith said openness and transparency would have helped Australia and the international business community in understanding and dealing with the matter.
"Regrettably, China and the Shanghai court chose to go down a different road," he said.
"That leaves serious, unanswered questions and a significant lost opportunity so far as China is concerned."
Mr Smith said Mr Hu would be taken to a prison in Shanghai, and consular access would be available for Australian officials and his family.
Officials will be granted one consular visit per month to Hu in prison.
"He will be assessed in that prison and after a short period of time consular access will be available to Australian officials," Mr Smith said.
Mr Hu's family would also have access.
Mr Smith said Australian officials on numerous occasions had asked for Chinese authorities to reconsider their decision to hold a closed trial in relation to charges of stealing commercial secrets.
"Multiple representations were made in Beijing, Canberra and Shanghai, including my own to the Chinese ambassador."
He said he believed the request was consistent with a consular agreement between Australia and China which came into force in 2000, but that Chinese authorities had disagreed.
"Chinese officials and the Shanghai court have made the point that they believe this decision was made consistently with Chinese law.
"And so, in those circumstances, under the consular agreement there is no right of appeal or arbitration process. But very strong representations were made by officials at various levels including myself."
Mr Smith said Australia had not yet ratified a prisoner exchange program with China.
"If and when that ratification process concludes, and there is an agreement between Australia and China, then Stern Hu may or may not fall within the provisions of that," he said.
"He may or may not be eligible for consideration under that transfer."
Mr Hu may or may not want to engage in such a transfer, pending his family's wishes.
Mr Smith said the fallout across the business and finance sector would be matter for the international business community.
"Whether there are any adverse consequences which flow for China and its engagement with international business, only time will tell," he said.
"My own judgment is that I don't believe the decision that has been made or has occurred will have any substantial or indeed any adverse implications for Australia's bilateral relationship with China."
Mr Smith conceded the case had caused a rift in bilateral relations, but denied it had any staying power.
"We did go through some tensions and some difficulties last year," he said.
"But whilst this has been a very sensitive, very important and very difficult consular case, I don't believe that what's occurred today will have an adverse impact on our own relationship."
Australia will continue to have a very strong "economic and broad broader relationship with China", he said.
