China on Tuesday denied restrictions on cooperation between domestic and foreign companies, saying the allegedly Rio spy case won't hamper iron ore talks.
It's an individual judicial case, in which the employees of Rio Tinto stole Chinese state secrets and posed a grave risk of damage to China's economic security and interests, Qin Gang, the Chinese Foreign Ministry spokesman told a regular press briefing on Tuesday. He added that the case wouldn't hamper iron ore talks.
Four employees of the world's second largest iron ore miner Rio were detained on July 5 in Shanghai on charges of espionage and some executives at Chinese steel mills who are suspected of involvement in the case are also under investigation.
Rio is still in talks with Chinese steel mills over iron ore contract prices although the negotiations have passed the June 30 deadline.
The detention of Rio's employees may have influence on China's negotiations on iron ore pricing with the firm, local media reported early Friday.
Eexecutives from China's major miners are under investigation, including managers from Baosteel Group Corp, Anshan Iron and Steel Group Corp and Laigang Group and Jigang Group.
The investigation, however, does not mean that we will restrict the operation of foreign companies in China, nor cooperation between Chinese and foreign enterprises, Qin said.
Qin said the government promised to protect foreign companies' legal and just rights.
Those companies, meanwhile, bear the responsibility of abiding by Chinese laws and regulations, he said.
According to local newspaper, detailed information of Chinese steel mills was found in computers of Rio Tinto's Shanghai office on Monday.
Information in Rio's computers includes the outputs, sales, purchasing plans, raw material stocks and schedules of production.
Even presidents of these companies may not have such detailed information, an insider said.
The insider said that Rio knew almost every detail of some Chinese steel companies, all of which signed long term sales contracts with Rio.
Foreign iron ore suppliers also bribed executives from Chinese steel makers during holidays and festivals, an insider said.
If China finds the Chinese miners have conducted illegal speculative purchasing, the government may cancel more than 20 companies'iron ore import licenses, sources said Tuesday.
Currently, 112 steel mills and distributors have iron ore import licenses.
Large state-owned enterprises may not have trouble but those small private enterprises may be among those being disqualified, said an insider.
China Iron and Steel Association (CISA), which regulates the iron and steel industry, and the China's Ministry of Commerce have begun a joint investigation into the issue.