Rio Tinto Chinese trial begins

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The trial of four Rio Tinto employees opens today in Shanghai  in a case closely watched by investors anxious over the business environment for foreign firms and their Chinese employees.

Four police vans swept into the court before 7am on a chilly, overcast day, just as commuters were starting to work.

The Shanghai government is likely to want the matter ended quickly, certainly before the 2010 World Expo opens in Shanghai in May.

But China's decision to close a portion of the trial to Australian diplomats has revived questions over the nature of the charges, and the transparency of the trial - highlighting the risks of operating in a country with a huge market but close ties between the state, the police and the courts.

The four from Rio's iron ore team, including Australian citizen Stern Hu, were detained last summer at the height of fraught negotiations over 2009 iron ore prices, creating a furor over China's opaque state secrets laws.

They were ultimately charged with receiving bribes and infringing commercial secrets.

China has closed the latter portion of the proceedings to Australian diplomats, who do have the right to observe trials involving their citizens, on grounds that secrets are involved.

Chinese media last summer accused the four of seeking industrial and production information about Chinese mines and steel mills, which many firms consider legitimate market information.

While the trial progresses in a brown and grey concrete building near an elevated highway in Shanghai, Rio's chief executive is in Beijing to address a conference of government and business elites in China, his firm's largest market.

Mindful of the international attention paid to the Rio case, China has stuck strictly to its own legal deadlines for moving the case from police to the court system.

Defence lawyers interviewed on Friday did not yet know in which order the charges would be considered, or which days would be open. The verdict may not be immediately announced.

- Reuters