FOREX WORLD TREND

Four Rio Tinto executives accused by the Chinese government of bribery and industrial espionage have begun their defence against the charges by hiring high-profile lawyers in Shanghai.

Stern Hu, Rio’s lead iron-ore negotiator and an Australian citizen, has reportedly hired Duan Qihua, or Charles Duan, the founder of China’s first private law firm.

The firm of Duan & Duan specialises in international trade and investment litigation and Mr Duan is well connected within the ruling party as a member of its People’s Political Consultative Process – the forum that debates new laws in China.

The Shanghai Morning Post reported today that the other Rio employees, who are all Chinese citizens, had hired leading criminal lawyers.
China detained the four Rio employees five weeks ago amid escalating tension over the latest round of iron-ore pricing negotiations. The Rio executives were initially accused of stealing state secrets – a diplomatically loaded charge that could have led to the death penalty for the accused.

The allegations were downgraded this week to receiving bribes and stealing commercial secrets but the Rio four still face up to seven years in prison if found guilty.

Iron ore contracts are agreed every year and China has been demanding a 50 per cent price cut in the new deal. Rio and the other miners have been pushing for only a 33 per cent discount to the multi-billion dollar contracts.

There has been uncertainty over what has motivated Chinese authorities to arrest the Rio negotiators. Chinese media reports have claimed that they obtained information from state-owned steel mills that may have strengthened their position in the negotiations.

Rio Tinto has denied any wrongdoing by its employees and has pledged to defend them.
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