“Once you get arrested on charges like these in China, you get found guilty, even if there is no real effective sentence, or prison sentence, awaiting you.“
Adam Brooks, BBC correspondent, on BBC World Service, July 07, 2001, after the arrest of US academic Li Shaomin, on charges of “spying for Taiwan”.
Australian Foreign Minister Stephen Smith said yesterday that Rio Tinto employee Stern Hu, Rio Tinto‘s iron-ore marketing chief in China, had been detained by Chinese authorities on suspicion of espionage.
But Smith said there was no evidence for drawing any link between the detention of Hu and any commercial matters concerning Rio, including its aborted $19.5-billion tie-up with Chinalco.
China Global Times, July 09, 2009
“We are perplexed by the reason for his detention,” Mr Smith told ABC television. “We’re asking for additional information as to the basis of his detention.”
Herald Sun, July 09, 2009, quoting Australia’s foreign minister
Business disputes in China are not always handled through the courts. Sometimes the foreign partner has been held hostage, threatened with violence, or beaten up. Anyone entering into a contract in China should have it thoroughly examined, both in the United States and in China. Contracts entered into in the United States are not enforced by Chinese courts. Care should also be taken when entering into a lease for an apartment or house. There have been instances of foreigners being ejected from their apartments because of lease disputes, and being prevented from re-entering, even to retrieve their belongings.
Americans doing business in China should be aware that if they become involved in a business and/or civil dispute, the Chinese government may prohibit them from leaving China until the matter is resolved. Civil cases may sometimes be regarded as criminal cases and the defendant may be placed in custody. Civil law disputes may take years to resolve. There are many cases of American citizens being prevented from leaving China for months and even years while their civil cases are resolved.
U.S. Embassy in China, Consular Sheet
The detention of the executives is not without precedent.
Chinese and foreign business people have been detained or even kidnapped in China during the course of business disputes, for alleged customs or tax evasion, or as a pressure tactic by government bureaus or state-backed rivals.
Reuters, July 09, 2009
Related: Rio Tinto Employees arrested in China, July 8
Update [July 22]: Poyuan Wei: functioning judicial systems are like refrigerators.