The Australian reports:
THE arrest of the four Rio Tinto executives in China on allegations of bribery and industrial espionage has heightened fears among foreign companies operating in the country.
Lawyers and risk consultants operating in China have reported a surge in inquiries from clients worried that something similar might happen to their staff. One Beijing lawyer said that the incident had forced a number of Western companies to consider just how close they operated to an invisible line.
The Rio executives were arrested five weeks ago and Chinese state media initially said the men would be charged with stealing state secrets.
The four executives, who were leading Rio's negotiation of multibillion-dollar iron ore contracts with China, were accused of bribing officials at state-owned steel mills to gain market information, which would allegedly put China at a disadvantage in the iron-ore pricing negotiations.
The arrest warrant for the four men was downgraded two days ago to bribery and stealing commercial secrets in a move that was seen as an attempt by the Chinese to defuse a diplomatic row.
Even though the background to the Rio incident is highly specific, Western companies operating in China have been spooked by the accusations.
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