SCDigest Editorial Staff

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The Sydney Morning Herald noted, ‘While there's Australian commentary that Hu's 10 years is an outrageously stiff, there's Chinese opinion that he has escaped relatively lightly. He could have received the death penalty.” What Do You Say? Click Here to Send Us Your Comments Click Here to See Reader Feedback

This week, a Chinese court handed out sentences of 7-14 years for four employees of Anglo-Australian mining giant Rio Tinto, an event that has many unsure what to think, while others say it highlights the risk of doing business with China.

The case was a strange one from the start, with the charges coming as they did after tough negotiations and disagreements between China and Rio over iron ore prices, after which Rio Tinto angered China by seeming to accept a $19.5 billion investment from Aluminum Corp. of China (Chinalco) and then backing out of the deal as criticism grew from shareholders, the Australian government and the public.

If was further complicated by the fact that the highest ranking executive charged, Stern Hu, was of Chinese origin but now an Australian citizen doing business in China.

Finally, the initial charges were said to be related to industrial espionage, but later swung to focus on corruption and bribe taking, which are the crimes for which the four ultimately were convicted.

There seems to be evidence that in fact there was some bribe taking going on. The company fired the found employees, and called their behavior “deplorable.”

Nevertheless, the length of the sentences left many Australians angry. But as the Sydney Morning Herald noted, ‘While there's Australian commentary that Hu's 10 years is an outrageously stiff, there's Chinese opinion that he has escaped relatively lightly. He could have received the death penalty.”

There’s something to keep you operating on the straight and narrow while doing business in China.

Other believe that the while they likely was some illegal activity going on, the decision to charge the four in the high profile cases was a form of response for the difficult relations between China and Rio Tinto.

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