Monday, 10 August 2009

Rio Tinto not alone in not knowing

Rio Tinto not alone in not knowing. It appears that Rio Tinto and the Australian Government are not alone in not knowing where in China the line is drawn between legitimate market research and illegal commercial espionage. This morning the China Daily gives some details of a report written by a Jiang Ruqin, ex-director of the Huai’an State secrets bureau in Jiangsu province, and published, a website affiliated with the National Administration for the Protection of State Secrets.

The Fairfax broadsheets splashed with a story from their China correspondent John Garnaut based on the Jiang Ruqin report in which China accuses Rio Tinto of stripping $123 billion from the country through a six-year program of commercial espionage. The Fairfax translation of the Chinese language website says that Rio was involved in a six-year clandestine operation against China’s steelworks and accuses the Anglo-Australian miner of ”winning over and buying off, prising out intelligence … and gaining things by deceit”.

Like The Age and the Sydney Morning Herald, the English languageChina Daily leads this morning with a story based on the Jiang report from the website. The paper highlights Jiang’s claim that the severity of the case highlights the need for enhanced surveillance of commercial secrets by the government but points out that he did not elaborate on any evidence to support his claims.

Jiang’s report states, says the China Daily, that, even though the State secrets laws listed economic intelligence as being under the purview of the National Secrets Protection Law, commercial secrets received insufficient attention from the watchdogs. The watchdogs division is short-staffed, so staff members focus on government organisations and military research and development, rather than State-owned enterprises, the report says.

The website version of Jiang’s report says the Rio case should prompt State officials and companies to do more to protect sensitive commercial information, and tighter measures should be taken to deter foreign businesses from spying. He also said, according to the China Daily translation, the country has entered a peak period of commercial espionage warfare, while the threat to economic intelligence and security of national economic activity increases by the day. He urged the government to make it clear what commercial data is regarded as an official secret.

The emphasis in that last sentence has been added by me. If an ex-director of the Huai’an State secrets bureau in Jiangsu province reckons this difference is not clear then surely Rio Tinto’s Stern Hu and his three Chinese national Rio Tinto colleagues can be forgiven for being uncertain as well. That at least should give Australian diplomats something to work on as they attempt to get the four at least released from prison on bail while awaiting trial.

More ominous, however, was this section of the China Daily report that was not based on the website report:

Misinterpreting a fine line between commercial data and an official secret is one thing. Bribery is quite another.

For those of you who would like to do battle with an automatic Google translation of the report it is available here.

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