Trial of Rio Tinto exec opens in Shanghai

The corruption trial of an executive of Anglo-Australian mining giant Rio Tinto and three other employees has opened in Shanghai eight months after their arrest. The case has strained ties between Canberra and Beijing and raised concerns over doing business in China.

Trial of employees of Anglo-Australian mining giant Rio Tinto Reuters

"The accused exploited their positions to seek gain for others, and at numerous times either sought or illegally accepted massive bribes from a number of Chinese steel firms," said the prosecutor's office, quoted by the state news agency Xinhua.

The head of the company's office in Shanghai, Stern Hu,  is charged with accepting a bribe of six million yuan (649,000 euros) while fellow defendant Liu Caikui is alleged to have taken three million yuan (324, 954 euros). Both men are expected to plead guilty to the charges while contesting the amounts.

The four defendants were arrested last July during contentious iron-ore contract negotiations which later collapsed. Earlier Rio Tinto had turned down a near-20 billion dollar cash injection from state-run Chinese mining company Chinalco, in favour of a tie-up with rival giant BHP Billiton.  

Prosecutors have also charged two other Chinese employees, Ge Minquiang and Wang Yong, with accepting bribes, but they are reported to have not yet decided how to plead.

Australian Prime Minister Kevin Rudd has told China that the world will be watching the trial "very closely". It is widely seen as a test of whether China is willing to honour commitments to foreign investors and build an honest and fair business environment.

The trial comes just four days after Rio Tinto's announcement that it had signed a 1.35 billion dollar (1 billion euros) deal with Chinalco to develop a huge iron-ore mine in Guinea.