Mining giant Rio Tinto has led global negotiations on iron ore prices [Reuters]

Liu Jieyu, the vice foreign minister, on a visit to Australia on Monday, urged Canberra to respect his country's legal system and not interfere with the case against Stern Hu, a Shanghai-based Rio employee.

Hu was detained on charges of corporate espionage on July 5, while Rio Tinto was acting as lead negotiator for global iron ore suppliers in price talks with Chinese steel mills.

Liu offered no new details of the allegations against Hu, but said that his alleged actions would have been illegal in Australia too, and that critics should wait for the facts to come to light.

"The facts of the case would constitute a violation of Australian laws were the facts [to] happen here in Australia," Liu said.

"The Chinese government respects the independent judiciary of the Australian judicial system. I think we would expect that the same from other countries."

'Sufficient evidence'

According to Chinese state media, Hu, along with three other employees who are also detained, is accused of bribing employees of Chinese steel companies to obtain confidential information on China's negotiating strategy.

China's steel industry consumes up to 60 per cent of global iron ore production and Beijing has been pressing for deep price cuts after two years of increases totalling more than 120 per cent.

No charges have yet been laid against the accused employees, but China has told the Australian government it has "sufficient evidence" that they stole state secrets.

The detentions have sparked a diplomatic row between the major trading partners, with Beijing earlier telling Canberra not to interfere after Kevin Rudd, Australia's prime minister, warned its economic interests were at stake.

'Good environment'

Due to its rapid industrialisation, China is the biggest buyer of iron ore in the world [AFP]

Liu defended the decision to prosecute Hu and his colleagues, saying it was in the interests of overseas businesses working in China.

"By dealing with this case, we are really establishing, or we are really trying to establish, a good environment for all companies in China - foreign companies operating in China and local Chinese companies," he said.

Rio Tinto has said that claims of corporate espionage made by the Chinese government are "wholly without foundation".

China is the biggest buyer of iron ore in the world and is also Australia's second-largest trading partner.

The value of two-way trade between the partners was around $57bn dollars last year.

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