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US geologist jailed for eight years in China

Australia's Bluescope urges dismissal of Cheung Kong case
Sydney (AFP) July 5, 2010 - Australia's Bluescope Steel has urged the Federal Court to throw out claims it misled a Hong Kong firm over the purchase of a mine, calling the case an abuse of legal process, a report said Monday. Bluescope denies deceiving Cheung Kong Infrastructure Holdings, controlled by renowned tycoon Li Ka-shing, over the sale of an iron sands mine in New Zealand. Bluescope and its adviser Merrill Lynch are accused of trying to sell the mine while knowing its top customer -- a rival bidder -- would stop buying the product if it was sold to a third party, the Sydney Morning Herald said. Cheung Kong is seeking damages from Bluescope and the investment bank that could include the mine's 190 million dollar (160 million US) purchase price, said the report, citing court documents.

Bluescope admits Chinese state firm Chengde Iron and Steel had threatened to stop buying the iron sands, but says it took the statement as a negotiating tactic. It also points to pre-sale documents warning Cheung Kong that it could not guarantee the information it was providing was correct or reliable. "We deny the allegations and we're certainly defending ourselves against the allegations," a Bluescope spokesman told AFP on Monday. Cheung Kong agreed to buy the mine in August 2008 but the deal was blocked by New Zealand's foreign investment regulators. Chengde stopped buying the iron sands but blamed the global financial crisis for the move.
by Staff Writers
Beijing (AFP) July 5, 2010
A US geologist was sentenced to eight years in jail in China on Monday on state secrets charges related to the sale of a database about China's oil industry, a US official and a rights group said.

US Ambassador Jon Huntsman, who attended Monday's sentencing in Beijing, expressed dismay over the punishment for Xue Feng and will continue to discuss the case with Chinese officials, US embassy spokeswoman Susan Stevenson said.

"The US government has concerns over Dr Xue's wellbeing. We remain concerned with his rights to due process under Chinese law," Stevenson told AFP.

"The protection of US citizens overseas is our highest priority... We will continue to visit him and discuss his case with the Chinese government."

US President Barack Obama discussed Xue's case with Chinese President Hu Jintao during a visit to China in November, US diplomats said previously.

Xue, a naturalised US citizen, was detained in November 2007 on charges of attempting to acquire and sell state secrets -- a database related to China's oil industry, according to the Dui Hua Foundation, a rights group.

Dui Hua's Joshua Rosenzweig told AFP that one of the group's many concerns was its suspicion that "some of Xue Feng's statements to the police might have been obtained under coercion including torture".

During meetings with US consular officials, Xue showed them scars on his arms which he said were from cigarette burns inflicted by his interrogators during his initial period of detention, Rosenzweig said.

At the time of his arrest, the 44-year-old Xue was working for the US energy and engineering consulting firm IHS, Dui Hua said in a statement.

Both Xue and IHS have stated that they believed that the database was a commercially available product. After Xue purchased the database, it was subsequently classified as a state secret, the statement said.

Xue's arrest and drawn-out trial has cast a spotlight on the pitfalls of doing business in China, especially for those born in China who have been educated abroad and taken on a foreign nationality.

Australian national Stern Hu, an executive with the mining giant Rio Tinto, was sentenced to 10 years in prison in March on bribery and trade secrets charges, in a case that raised hackles in Canberra.

"A terrible injustice has been done to Dr Xue and his family, who for more than two and a half years have been waiting for a court to decide this man's fate," Dui Hua's executive director John Kamm said of Monday's verdict.

"I can only hope that the Beijing High People's Court will reconsider the heavy sentence that has been imposed and do so in a far more timely manner so that this man, who suffers from a serious heart condition, can return home to his family and doctors as soon as possible."

It was not immediately clear if Xue would appeal against the verdict.

Repeated calls to the court about the case went unanswered.



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